Member Article

It pays to PAYE online

With Jill Lee of Business Link

It’s that time of year when all business owners finally get to pack away the calculators after filing the tax returns, but what about the other forms that need to be registered over the course of a financial year? HM Revenue & Customs (HMRC) has been looking into creating easier and more secure ways for businesses to post employee forms online, based on the growing number of companies posting their tax returns electronically.

A record 3.7 million business owners filed their returns online by the 31 January 2008 deadline, and now HMRC are looking to extend this service to in-year forms based on this success. Companies now have the choice to post forms relating to employee starter and leaver information (ie P45s and P46s), as well as similar pension information, via the Internet - but it will soon become a mandatory requirement.

From 6 April 2009 it is only compulsory for businesses with 50 or more employees to post these types of in-year forms online to HMRC. However, all other SMEs - regardless of how many members of staff it employs - must send this information online from 6 April 2011.

This may seem like a long way off, but HMRC recommend that all businesses start sending in-year information online as soon as possible. The sooner you have your software and internal processes in place the less time you’ll have to spend any time worrying about any upcoming deadlines.

There are a number of different filing options to choose from, and the option you choose for in-year form returns does not have to replicate the way you send in your Employer Annual Return. You can choose from a payroll agent or bureau, HMRC’s Online Return and Forms - PAYE products, an off the shelf payroll software or an Electronic Data Interchange (EDI).

Different in-year forms can be sent in different ways too. For example, you can send your P45s in using third party payroll software while your end of year returns can still be sent using HMRC’s Online Returns and Forms product.

If you need some impartial advice regarding how this new piece of legislation will affect your business, you can of course get in touch with Business Link and find out more. Business Link’s substantial team of expert brokers operate across the region in local access points and on a mobile basis. For further information about Business Link visit www.businesslinknortheast.co.uk or call 0845 600 9 006.

This was posted in Bdaily's Members' News section by Ruth Mitchell .