PAYROLL INSIGHT
Samantha Mann MCIPPdip MAAT, CIPP senior policy and research officer, discusses developments S ome would argue that the roll out of real time information (RTI) – and, prior to that, ‘filing by internet’ – provided the run up to making tax an EYU for each affected employee records, but what values are to be Electronic submissions to HMRC
information to make amendments to the tax year ending 5 April 2019. To aid the transition to the new process, however, HMRC will still accept an EYU return to make amendments to the 2018–19 tax year as well. Subject to functionality offered by payroll software, during 2019 (for the 2018–19 tax year) the employer will need to choose which method they will use to report amendments and continue with this method for any further amendments to the year (if required). From April 2020, the EYU return will no longer be a valid submission to make an amendment for the tax year ending 5 April 2020. Any amendments will need to be made using a FPS return. In essence, 2019 is providing a ‘pilot’ year, in the hope of providing a smoother transition to April 2020 (and beyond) when the the EYU will no longer be accepted for the purpose of reporting adjustments for the tax year 2019–20 and onwards. From 20 April 2020 onwards, HMRC’s Basic PAYE Tools software will be updated to allow customers to submit a FPS return for the year ending 5 April 2020 and onwards, to report any amendments. Unfortunately, amendments prior to tax
reported? When HM Revenue & Customs (HMRC) holds one set of numbers – that the employer can’t interrogate – and the employer holds another set which clearly don’t match those held by HMRC, what delta values need to be applied? ...re-submission of YTD totals via a FPS return would be a better solution? Surely a re-submission of YTD totals via a FPS return would be a better solution? All agreed that this would indeed be a more sensible solution, but only now can we look forward to this method being delivered. As of April 2019, HMRC will be extending the use of the FPS to enable payroll software to allow users to report revised YTD payment data beyond 19 April, following the end of the 2018–19 tax year. Accordingly, from 20 April 2019, HMRC will begin to accept FPS returns with YTD
digital. Indeed, I boldly suggest that where payroll goes, others will inevitably follow.
Farewell to the EYU The end of the tax year process as we previously knew it was eliminated by RTI, but payroll software was prevented from submitting a full payment submission (FPS) with year-to-date (YTD) totals for a closed tax year once 19 April had passed. This elimination didn’t, however, remove the need for employers to make corrections to previously submitted figures. Instead of a correction to the YTD totals, the solution continued to be the reporting of delta values (i.e. the amount needed to correct a previously reported amount) via a newly created earlier year update (EYU) return, thereby mimicking the function the P14 return had also served. The EYU was never a popular solution and one flaw became immediately apparent for unfortunate employers (and their software suppliers and service providers) that experience duplicate payments. In attempting to correct this anomaly they would be asked to submit
| Professional in Payroll, Pensions and Reward | February 2019 | Issue 47 18
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