Entries by Dorothy Carter

Late Filing Penalties

From 6 October 2014 the HMRC computer automatically issues you with a penalty if you submit your full payment submission (FPS) under RTI “late”, or don’t submit it at all for a month in which you paid your employees. So what makes the FPS “late”? HMRC say the FPS must be submitted on or before […]

National Insurance Contributions

It seems that HMRC is trying to gather every penny in tax and national insurance contributions (NIC), from every possible source. Recently it has been demanding payment of class 2 NICs from landlords and investors in investment partnerships. If you get a bill for back-dated class 2 NICs should you pay it? The annual class […]

Understanding the CIS

If you are a contractor in the construction industry it is essential that you deduct the right amount of Construction Industry Scheme (CIS) tax from payments you make to subcontractors. A common misunderstanding about the CIS is that deductions of CIS tax only have to be made from labour costs. This is not the case, […]

Maximising statutory maternity pay

Paying statutory maternity pay (SMP) is not optional. It must be paid if your employee qualifies, but the good news is that a small business can recover 103% of the SMP paid from HMRC. A business that pays less than £45,000 of class 1 NICs in one tax year is defined as “small” for this […]

PAYE reconciliations

If most of your income is taxed under PAYE (Pay As You Earn) you may soon receive a reconciliation of the income tax you have paid compared to the amount that was due to be paid for 2013/14. This calculation arrives on a form P800, which should be checked very carefully for errors and omissions. […]

Real time information (RTI) penalty notices

As an employer you may have received an RTI penalty warning letter accusing you of not submitting all of the RTI returns required for 2013/14. However, that letter may be incorrect. HMRC has admitted that its computer has churned out inappropriate penalty warning letters to employers who have submitted employer payment summaries (EPS) during 2013/14. […]

Real time information (RTI) interest

In the past some employers would play the PAYE system, holding on to the PAYE deductions until the last payment date of the year, and then paying the balance due before interest was charged. That is no longer possible under real time information (RTI), as interest is now charged on late paid PAYE and CIS […]

Auto-enrolment into workplace pension scheme

Auto-enrolment is the term for the law that requires all employers to register their employees into a qualifying workplace pension scheme. This requirement is being rolled-out to the largest employers first and will eventually apply to the smallest employers from June 2015 onwards. For example if you have 62 to 89 employees you should have […]

New RTI relief and penalties

Have you been struggling to send full payment summary (FPS) reports under RTI to HMRC on or before the days on which your employees are paid? This is particularly difficult when your workers receive irregular amounts of pay on varying dates. In such cases you may not know the amounts of wages and deductions to […]

New real time information (RTI) messages

Real time information (RTI) is all about one-way communications with HMRC. Your payroll software sends reports (called FPS or EPS) to HMRC about the deductions made from your employees’ pay, and normally you hear nothing back. That is starting to change. HMRC is now sending electronic messages to employers to inform them that not all […]