COMPLIANCE
In this issue, the CIPP’s policy and research team explores the various deadlines payroll teams must observe and discusses the repercussions where they’re not met Deadlines
A crucial element of payroll processing involves adherence to deadlines. Whether that be ensuring employees are paid on time, payroll documents submitted promptly or remittances paid across to Her Majesty’s Revenue and Customs (HMRC), payroll professionals always need to keep one eye on the calendar. In fact, being driven by deadlines is often a quality listed by employers when recruiting for their payroll teams.
Key annual deadlines
The consequences of missing important deadlines
National living wage and national minimum wage (NMW) rates are implemented from the first pay reference period beginning on or after 1 April
1 April
6 April
Start of the new tax year
Deadline for the final real time information (RTI) submission for the year
19 April
31 May
Issue P60s to employees who were on payroll on 5 April
P11Ds sent to Her Majesty’s Revenue and Customs (HMRC), and to employees Payment of class 1A National Insurance contributions (NICs) if paying by cheque
6 July
19 July
22 July
Payment of class 1A NICs if paying electronically
Payment of class 1B NICs if paying by cheque, where a pay as you earn settlement agreement (PSA) is in place Payment of class 1B NICs if paying electronically, where a PSA is in place
19 October
22 October
Deadlines for full payment submissions (FPS) Payroll teams must ensure they send certain information across to HMRC within prescribed timeframes throughout the year. An FPS is an example of this and must be submitted to HMRC every time payments are made to employees. This must be sent on or before each pay day. If an FPS is submitted late or the
Having good timekeeping and organisational skills is imperative for payroll professionals, due to the impacts of missing deadlines. Arguably, the biggest pressure that payroll teams feel will be in ensuring employees get their pay and their payslips on time. Failure to meet this deadline would always have substantial negative implications. However, this may be all anyone outside of the payroll team sees. Where the variety of deadlines listed on the left are missed, this could also cause financial and reputational detriment to a business. Take failure to pay the appropriate NMW rates at the correct time as an example. Not only can an employer be fined up to £20,000 per underpaid worker, but they can find themselves publicly named by the Department for Business, Energy and Industrial Strategy. It's important to remember, as well, that HMRC penalties can escalate. So, even if a deadline is missed, the advice is to act quickly to get whatever information or payment is required across to the relevant place, to avoid facing spiralling fines.
expected number of FPSs aren’t sent, then a penalty may be issued. Additionally, if an employer payment summary (EPS) isn’t sent when no employees are paid in a tax month, a penalty could be applied. In situations where the deadline is missed, and there’s a valid reason for this, there’s an option to select a ‘late reporting reason’ upon submission of the FPS. HMRC won’t charge a penalty in certain circumstances, including where:
● an FPS is late but the reported payments on the FPS are within three days of the pay day (where this is a regular occurrence, employers may be considered for a penalty) ● a new employer is sending their first FPS within 30 days of paying an employee ● it’s the employer’s first late report within the tax year. The amount charged is dependent on the number of employees a business has, and where there is more than one pay as you earn (PAYE) scheme, employers can be charged penalties for each. Use your voice: Do you have any tips or tricks you could share with fellow payroll professionals on ensuring compliance with deadlines? We’d love to hear from you. Please email the policy team, at policy@cipp.org.uk .
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| Professional in Payroll, Pensions and Reward |
Issue 80 | May 2022
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