HMRC has opened a new consultation on PAYE pooling. It is suggested that connected employers would save costs and administrative burdens if they could be treated as one employer for PAYE purposes.
The consultation document notes that HMRC does not currently have a specific definition of what is meant by “connected employers”. It expects to apply different criteria for private businesses than public bodies.
- For private business employers this would consider some commonality in business and ownership.
- For public employers these would be perhaps grouped under a particular Local or Health Authority.
- PAYE Pooling will not be available to payroll agents or other third parties.
There are numerous issues for the private sector to address not least HMRC’s tax penalty regime and debt collection, however, as many firms already outsource payroll functions pooling is not mechanically at least very easy.
Source: HMRC PAYE Pooling
Consultation ends on 15/12/2011