Payroll schemes – use them or lose them


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HMRC has announced that it will automatically shut down payroll schemes that aren’t used.
If you set up a payroll with HMRC but then don’t file any returns for 4 months, HMRC will close the scheme down.

This could save a lot of time, but also help businesses avoid fines. In the past few weeks, we’ve spoken to a few companies who are being fined for not filing an April 2013 year-end PAYE return, despite not actually having any staff during the year. They were required to file a £nil return, and are now being fined because they didn’t. The new system would have avoided this. (And we should mention that they weren’t our clients at the time – none of our clients were fined.)

From October 2013, PAYE schemes will automatically be closed where:

  • No real time PAYE submissions have been made
  • No payments have been made to HMRC
  • The employer is not an annual payer
  • There is no evidence that the employer wants to claim Construction Industry Scheme deductions
  • The employer has not received an advance from HMRC
  • There have been no periods of Construction Industry liability
  • There is no evidence that the employer has any employees
  • There is no evidence that Class 1A NIC is due.

There are, however, some instances where businesses do want to keep the payroll open even if it’s not being used, so it’s worth having a chat with your accountant about this.

Any questions?

If you would like to arrange a free meeting with a Liverpool accountant to discuss payroll and business taxes, either at our office or at your premises, please contact us on 0151 724 3960 or by email at [email protected].

Alternatively, you can use our website contact form.

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Added by Jon Davies

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