occurred. We apologise if this is causing concern for employers and hope that you will understand the complexity of these issues. We appreciate that employers are getting used to the new ways of reporting and we are using this information to review and update our guidance.
The reasons identified so far are listed below. Please bear in mind that the number of employers with apparent underpayments is only a small minority of the pilot employers.
Content and date of submission of EPS We are highlighting the importance of submitting an EPS before 19th and including YTD information though our communications and guidance. Incorrect tax week/month This was mentioned at last CUG meeting, since when we have identified a number of employers who are not using the correct tax week (or month) relating to the date they actually pay their employees. This leads the employer to thinking that the payment relates to a tax period that is inconsistent with the payment date included on the FPS or EPS. We are currently considering the guidance needed for employers who are operating incorrect tax periods. Correction errors in next payroll run – but adjustment of payment in current month. Where employers chose to report corrections in the next FPS they are still required to pay the full amount recorded on the FPS less amount recorded on the EPS. We are finding that some employers are paying the known amount rather than the recorded amount. This is resulting in an underpayment. We will update our communications to highlight this practice will lead to an underpayment of tax to HMRC. Duplicate (or too few) employment records held by HMRC: If the employment records held by HMRC contain duplicate employments, and therefore do not match the employment records held by the employer, it's likely that we will be expecting the employer to pay more than is actually due. We have published guidance about avoiding the creation of duplicate employments to software developers and in our pilot employer updates. Nil EPS Employers are required to submit a Nil EPS if they have not paid any employees during a payment period. A small number of employers have not submitted a nil EPS in these circumstances. We are reviewing our guidance to ensure this requirement is clear. L&P Viewer Additionally, employers are checking the L&P viewer and identifying apparent differences between what they believe they have paid and what is shown. This could be for one of the reasons above but also because L&P viewer is updated on set dates each month. We are investigating the possibility of including a message for L&P viewer to advise employers of the update dates and the need to submit an EPS. Additionally, we have received a question about the submission of an EPS where employers operate split schemes. This has not been identified as an issue during the pilot as there should not be any “split schemes” reporting PAYE in real time during 2012-13. However, you may wish to remind your members/clients/colleagues of the guidance When to report - Summaries of statutory payments recovered, CIS deductions and NICs holidays . Even if an employer operates separate payrolls on the same PAYE scheme, for example a weekly payroll and a monthly payroll, they must send one EPS to cover the whole PAYE scheme. In view of the question that has been asked on this topic, we have reviewed the guidance and will include more detailed information shortly.
HMRC WEEKLY UPDATE 1 MARCH 2013
CIPP Policy News Journal
12/04/2013, Page 213 of 362
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