MY CIPP
The CIPP's Advisory Service team provides answers to popular questions
Multiple PAYE schemes for a single business Q: A client has asked if it can operate more than one pay as you earn (PAYE) reference scheme for its only business? A: If an employer wishes to process several payrolls to pay separate groups of employees, a formal election must be made to Her Majesty’s Revenue and Customs (HMRC). The form, ‘Election for a separate PAYE scheme’ can currently only be printed and posted to HMRC and can be found here: https://bit.ly/3LHhqwK. Relocation allowances for multiple employees Q: A company employs a couple who are required to relocate to its new office in Scotland. As the employees will be incurring costs, the company wants to pay relocation allowances but is unsure how to treat the payment, as the employees will be living together. Will they be entitled to £8,000 as a couple, or to a relocation allowance of £8,000 each? A: Neither section 271 of the Income Tax (Earnings and Pensions) Act (ITEPA) 2003 or the HMRC manual starting at Employment Income Manual (EIM) 03100 make specific reference to the £8,000 exemption for allowable relocation expenses being restricted to a household. There are, however, numerous references made to ‘the employee’ and HMRC has confirmed the intention of the legislation was always towards the individual. Therefore, there should be no reason why both employees can’t be entitled to the exemption, where their employer requires them both to relocate, and
confirms it will reimburse any of their allowable expenses. The employer must check there are no duplications of the reimbursement of expenses incurred because of the relocation. For reference, see: https://bit. ly/3J9Sa0b and https://bit.ly/3r0PewD.
submission (FPS) for each payment made to employees. The same would apply even if the employer had received an advanced payment from HMRC to cover the cost of statutory payments. If an employer is eligible to claim the employment allowance, an EPS would need to be submitted at least once each tax year. If a business is still registered as an employer, however, but currently has no employees, there’s still a requirement to notify HMRC that no payments are due. The employer should use an EPS instead of an FPS to inform HMRC there were no employees to pay in the tax month. The employer can also notify HMRC up to a year in advance that it won’t pay any employees. To do this, dates must be entered in the ‘period of inactivity’ fields in the EPS. Status determination statements Q: A client has informed us two contractors received payment in April and May 2021 but has since discovered that no employment status determinations were made on their contracts. As a substantial period has now elapsed, is there a requirement for them to conduct an assessment for IR35 regulations? A: Reforms to the off payroll working (IR35) legislation in the private sector apply to payments in respect of services provided from 6 April 2021. It would be necessary to determine the dates the services were provided, as this will identify whether the original or reformed legislation would apply. If services were provided after 6 April 2021, there will be no exemption to the rules, and so if the contractors are assessed as being ‘inside IR35’, then it’s advisable for the end-client to make a voluntary disclosure
Is the £8,000 relocation allowance allocated per individual or per property?
Real time information submissions where no payments are due to employees Q: A client has asked for clarification regarding the submission of an employer payment summary (EPS) to HMRC. If there are no figures to report on an EPS in a pay period, should a blank EPS be submitted to HMRC? A: Employers wishing to reclaim relevant statutory payments should send an EPS for each tax month as well as a full payment
| Professional in Payroll, Pensions and Reward | May 2022 | Issue 80 6
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