End of tax year 2013/14

One of the changes that arose from the introduction of PAYE Real Time Information (RTI) for 2013/14 was the ending of the requirement for employers to submit forms P35 and P14 following the end of the tax year. The payroll details are now submitted in real time under RTI.

However there are questions similar to those included on the P35 declaration that need to be answered and submitted with the final submission - HMRC - Final  submission what to report

For many employers the final submission will be the final Full Payment Submission (FPS) informing HMRC of the last employee payment in the tax year ending 5 April 2014.

The software used by some employers may be prompted to submit the answers to questions on the declaration for ‘Final Submission for the tax year’ using the Employer Payment Summary (EPS). Employers who have not made any employee payments in Month 12 (6 March 2014 to 5 April 2014) will need to use an EPS anyway to make the final submission for the tax year.

The final submission should be made on or before the date of the employer’s last employee payment or by 19 April 2014 if sending an EPS. Penalties may be charged for late submission.

Forms P60 should be provided to employees who are still working for their employer at 5 April 2014. The employer has until 31 May 2014 to provide this form.

If employers have any expense payments or benefits to declare for 2013/14 then Forms P11d, P9d and P11d(b) should be submitted to HMRC by 6 July 2014 to avoid possible penalties.

2014/15 (from 6 April 2014)

There are some changes under the PAYE/NIC and RTI regulations that will apply from 6 April 2014 as follows:

Employment Allowance - The Employment Allowance will be introduced on the 6 April 2014 and will give eligible employers a reduction of up to £2,000 in their employer Class 1 NICs liability for 2014/15 ( Edwin Smith article -  Employers Allowance ).

Change of bandings for Reporting ‘hours worked’ for employees -

From 6 April 2014 there will be an increase to the number of bandings from 4 to 5 relating to normal weekly hours worked by employees. The revised bandings will be:

A) up to 15.99 hours

B) 16 to 23.99 hours

C) 24 to 29.99 hours

D) 30 hours or more

E) Other.

It is very important that an accurate figure is provided as the number of hours is used to support claims to benefits and Tax Credits. The employer needs to make sure that they do not simply carry forward previous selections made into 2014/15 ‘hours worked' bandings which may no longer be appropriate due to the changes.

Micro employers’ concession – the concession that applied in 2013/14 for employers with less than 50 employees will end on 5 April 2014 but will be replaced by a new concession applying to existing micro employers with less than ten employees. The concession will continue the relaxation of the RTI reporting rules for these employers until April 2016 so that FPS reports can be made on or before the last payday in the tax month.

From 6 April 2014 all other employers including new employers (with less than ten employees) will be expected to report each time they pay their employees.

Late reporting - From April 2014, it will be possible to tell HMRC the reason why a particular payment is being reported after the payment date by making an entry in the new ‘Late Reporting Reason’ data field on the FPS.

There is one change for 2014/15 that takes effect this month and it is for:

Employers running payrolls in advance of paydays in new tax year – HMRC have made changes to their software to enable employers who run their payroll in advance of actual payday to make a submission (either FPS or EPS) from 6 March in respect of payments to employees on or after the commencement of the new tax year on 6 April 2014.

If you require further information or assistance regarding PAYE (RTI) or payroll then please contact us.