HMRC have published their Employer Bulletin for October 2024. We have summarised the key content for you, with links to our detailed guidance on the topics covered.
Introduction of Statutory Neonatal Care Leave and Pay
The introduction of this relief was covered in our Agent Update for September 2024.
Real-Time Information (RTI) reporting obligations for payments made early at Christmas
This is a fairly common situation and there is a permanent easing on RTI reporting that applies. Where employers pay early over the Christmas period, they must report their normal or contractual payment date on the Full Payment Submission (FPS). For example, if payment is made on 23 December but the normal payment date is 31 December, report the payment date as 31 December and send the FPS on or before 31 December. This helps to protect employees' eligibility for income-based benefits like Universal Credit.
Registering as an employer: online process
This change in process was covered in our Agent Update for September 2024.
Salary sacrifice and National Minimum Wage (NMW)
Salary sacrifice schemes are one of the common causes of NMW underpayments because the reduced contractual pay may take workers' rates below the NMW.
A salary sacrifice scheme includes a contractual change to workers' pay. Where there is no contractual change, the usual NMW deduction rules apply.
PAYE Settlement Agreement payment
Electronic payments for the 2023-24 PAYE Settlement Agreement (PSA) must be received by HMRC by 22 October 2024 to avoid interest and a late payment penalty. Employers will find their PSA reference number on the payslip received from HMRC.
It is important not to use the normal PAYE Accounts Office reference for the PSA payment as the payment will be incorrectly allocated.
PAYE charge queries
Every month HMRC creates a 'PAYE charge' for each employer and pension provider which shows the amount HMRC anticipates. This should agree with the amount the employer/pension provider believes is due, but sometimes there are discrepancies. Most are quickly resolved but some cases are referred to the Charge Resolution Team.
A common cause of the discrepancy is duplicate employment records for an individual employee:
- Adhering to the software processes correctly helps to avoid this issue.
- For new starters, ensuring the starter notification and first FPS include accurate personal details from the outset makes it less likely subsequent updates are processed as a new individual.
- Unique payroll IDs: where an employee works in more than one job for an employer, and those are on a different payroll within the same PAYE scheme, the employee payroll numbers must be different. Payroll software often generates these numbers and it is important to understand the process for ID generation.
- Where an employee leaves:
- Changes to leaving dates do not need to be reported to HMRC.
- Once an FPS has been submitted with a leaving date, another should not be submitted unless it is a correction or 'Payment after Leaving'.
- Payments after Leaving and corrections made after leaving must include the original leaving date as submitted on the FPS when the employee left.
- The Payment after Leaving indicator should only be set if a P45 has been issued to an employee and a subsequent payment is made.
- Duplicate or identical FPS should not be submitted reporting a Payment after Leaving unless a rejection notification is received in respect of the original submission.
Preventing other causes of discrepancies:
- Do not enter 0.00 in the 'Occupational Pension' indicator - leave it blank.
- For an employee who is paid infrequently, set the 'Irregular Payment Pattern' indicator.
- To prevent payment allocation issues for early and late payments, ensure the correct four digits are added to the 13-character Accounts Office reference. These digits are the last two numbers of the tax year, together with the relevant month of the tax year. Thus, 6 June to 5 July 2024 will have a reference number of 2503.
Employers PAYE - variable direct debit plan for PAYE
Introduced in 2022, HMRC encourages all employers to adopt this method to ensure payments are on time and correctly allocated. It can be set up online following PAYE enrolment. From the HMRC online account click on the link to 'see all upcoming PAYE payments' and select the 'set up a Direct Debit' link. Once set up, employers receive a secure notification at least three working days before the collection date confirming the amount HMRC will collect and when.
Notice of change to the effective date of new data requirements on employee hours
The proposals to collect additional information through PAYE have been Deferred to April 2025.
Employers' PAYE and Construction Industry Scheme repayments
HMRC is making improvements to the online claim form for repayments:
- For CIS repayment claims, the form will enable the uploading of evidence and will direct claimants to an online tool to find out when HMRC will reply.
- For PAYE, an online claim form is also being introduced. Overpayments as a result of an error by the employer, of duplicate payments should be accounted for by paying less on the next PAYE bill.
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