PAYA compensation agreements (PAYA) are often used by employers to maintain compliance with employee cost and social benefits procedures. By entering into this formal agreement, an employer can pay any tax due on expenses and benefits to workers through an annual submission and payment to the HMRC. From April 2018, the annual process for renewing PPE contracts has been simplified, so employers are not required to agree to a PSA with HMRC each year if the categories remain the same. Under the agreement, the EPI will remain in place until the employer or HMRC terminates or amends it. taxagents.blog.gov.uk/2019/06/25/paye-settlement-agreement-deadline-6-july-2019/ Once an agreement has been reached, two copies are issued to the employer to sign and report HMRC. After the ordering orderer signs, one copy is stored in the file and the other is returned to the employer. The deadline for submitting PSA income tax calculations and NIC calculations to HMRC is indicated in the agreement and generally ends on July 31 following the end of the tax. Psa`s liability payment deadline is October 22 after the end of the fiscal year or October 19 if the employer does not pay electronically. For example, the total cost of providing a $100 PSA gift to a 40% taxpayer is about $190. For THMC experts, tax advice to businesses like this is daily. If you would like to know more or would like to discuss something accounting, call us on 0800 470 4820 or email us info@tfmcentre.co.uk. If you do not have an PPE in place and miss the deadline to apply for an EPI, but still want to pay taxes in this way, you may be able to make an optional disclosure and billing with HMRC.
However, you should be aware that, in certain circumstances, you must pay a fine. To manage their resources, HMRC requests calculations that are submitted annually until a specified date that may differ by agreement, but which is usually July 31 or August 31. It is interesting to note, however, that there is no legal time limit for submitting calculations, so no penalty can be imposed for not presenting your calculation until that date. If you do not have an PPE yet and miss this deadline, it is possible to make a voluntary disclosure and a tally of items that you would otherwise have included in an EPI. However, in certain circumstances, HMRC may impose penalties and collect interest on amounts paid in this way. The value of the services provided should be taxed under the EPI at the marginal tax rates of each worker concerned. It is therefore important that tax rates for workers residing in each of the UK countries are also taken into account, as deceded governments (currently Scotland and Wales) are able to set the tax rates payable by taxpayers based in those countries. If you don`t have a PSA agreement yet, our team of labour tax specialists can help you set up and contact HMRC to make sure the agreement contains everything you want to include now and in the future.