HM Revenue & Customs (HMRC) representatives:
Margaret Knights (PAYE - MPPC) Chair
Jen Morgan (PAYE - MPPC)
Simon Lidster R (PAYE - MPPC)
Neil Stenton (PAYE - MPPC)
Sue Higham A (PAYE, SA, NIC Process MPPC)
Carolyn Parmeter, (BCU, Carter Programme)
Pam Jones M (IMS Portfolios)
Tim Downes (IMS Portfolios web solutions)
Liz Redmond (PAYE, SA and NI)
Colin Henzell (PAYE – MPPC)
Sue Manley (PAYE – MPPC)
Luca Alessandra (PAYE MPPC) Minutes
External Stakeholders attending:
Institute of Chartered Accountants in England & Wales
British Chamber of Commerce
British Computer Society
Chartered Institute of Taxation
Institute of Payroll Professionals
Payroll Alliance
Business Application Software
Developers Association
The Consultative Forum Chair opened the meeting and passed apologies from Roger Smith MPPC Programme Director and the Electronic Exchange User Group representative.
The Forum External Stakeholders (ES) were still concerned about the use of new P45 plain paper version and employers responsibilities. HMRC reassured ES that normal compliance rules would apply. HMRC reminded attendees that the current preprinted version of P45 will still be available for employers to use.
They also asked for the guidance leaflet to make clear what employer responsibilities were in the event of misuse of the electronic version of P45.
Going forward, HMRC expects that the new P45 technical specifications and guidance leaflet will benefit from further enhancements in time for the 2010 reprint.
ES also discussed the implications of an employee taking copies of P45 to give to more than one employer and asked for specific advice to be added to the guidance to ensure employers know what to do if they identify an electronic version of P45 that had been tampered with or they if had suspicion that a new employee might had misused it.
HMRC agreed to amend the guidance accordingly.
The Action points were also discussed and updated. The forum secretary will publish those minutes on the HMRC website shortly.
HMRC confirmed that the programme is still on track for October 2008 data migration and controlled go-live. Some recent change requests will not be implemented in time for the business simulation in June. Controlled live EDI on 06 April 08 gave HMRC the chance to ensure that the interface communication links are working properly; the service was then open for public use on 09 April. This has been an excellent trial exercise ahead of Go-Live next October.
HMRC reminded attendees that during the data migration in October 2008 there will be a period of ten days were the PAYE Service will not be available to the public (downtime) and to HMRC staff. HMRC is looking at ways to minimize downtime and its impact to the public, as well as strategies for deploying PAYE processing staff during downtime. A lot of efforts are currently going towards finding best ways to handle customers’ enquiries during downtime, as well as to ensure downtime is suitably publicised before hand.
HMRC expects that the MPPC programme will end around April 2009.
The validations, supported by legislation, were successfully introduced on 6 April and after a period of testing with live data the service was opened on 9 April. HMRC thanked all involved with the testing. HMRC hopes for a PENNOT fix to be introduced in early May 2008.
Limitation on file size on Internet still causes a little concern and HMRC
is working to fix this.
Submission statistics and results have been handed out and show that quality
of online data is increasingly in line with expectations. Whilst it is very
early days, figures showed the level of rejections to be very low: around
2 per cent for Internet submissions.
Local practices have so far not been an issue and were referred to employers where necessary. Communications on common errors, as the default tax code, were issued on 29 April.
ES asked if employers could use D0 code for excessive salaries instead of BR code; this issue had previously been considered and rejected, however HMRC will re-consider and report back. ES thanked HMRC for the work carried out in this area.HMRC is confident that the replatforming of HMRC online returns and forms on PAYE service will go ahead in October as planned.
HMRC is preparing articles for the Trade Press on migration/deletions of employers’ data to the new portal and communication aimed to improve the portal messaging.
ES asked if HMRC could find a way to flag new messages so they can be distinguished from old read messages (like with MS Outlook for example). HMRC said that they had no plans in place for this, but will pass feedback on and report back.
Phase 3 will in April 2009 see implementation of:
Implementation of the technology for penalties’ notification.
ES said employers cannot file P35 with employee National Insurance contribution and a NIL employer National Insurance contribution on the P14. HMRC said that there were no plans to provide this facility for a direct payment cases. HMRC will refer the matter to the relevant technical specialist office.
ES said that if a P46, showing a date of commencement in 2007-08, is submitted using HMRC Online Returns & Forms Service, after 6 April 2008 the Tax Code shown on the screen will reflect the 2008-09 allowances, when in fact the employer correctly used applicable 2007-08 Tax Code against the 12 month payment. ES reported there is a danger with the current routine that the Tax Code uplift will be given twice.
HMRC presented some slides showing how MPPC is concentrating its efforts on Customer Outcome Focus and quality of service, as well as ensuring efficiency and flexibility of staff to ensure a first class service is maintained for its customers after October 2008. Business Simulation is a key example of activity the MPPC Programme is taking to ensure that the implementation of the PAYE Service in October 2008 is successful.
The Business Simulation, a life-like office environment operating the IT system that HMRC will be using from October 2008, will see over 65 staff undertaking key customer and business processes to ensure that all elements of the user learning, guidance and IT functionality work together to support users through the transition. It will also be an opportunity to test customer experience. Some core aspects of the PAYE Service and PAYE Work Management system, such as Employment Maintenance, Coding, Individual Maintenance and Data Reconciliation will be worked.
Following consultation with Employer’s representatives - a letter outlining the issue was sent to external consultees earlier this year - HMRC has decided to cease the issuing of bulk P6B and P9 data via magnetic media; these will no longer be issued by HMRC from April 2009. HMRC also suggested that they will discontinue the issuing of bulk P6B and P9 data on paper lists with effect from October 2008. 5,000 employers, of whom 230 are large, will be affected.
ES agreed that there are adequate electronic alternatives and as a last resort employers could have paper P6s.
HMRC will write to all employers still using this method of receiving this data in advance, also suggesting preferred alternative methods. HMRC will also write to all employers who submit paper format annual coding lists to let them know that these will also no longer be accepted by PAYE processing offices. HMRC also promised to update Employers’ Talk.
HMRC explained in details the data migration process, which will entail two distinctive activities: data matching and data synchronisation.
In a nutshell, HMRC will use the National Insurance number and personal details held on two existing databases, NIRS and CID, to match customer’s data first. Where this process fails, HMRC will use alternative available search engines for reconciliating unmatched data, so there will be no need to contact these customers/employers for further information.
Once records have been matched the personal data on them will be synchronised, and at cutover the PAYE information will be loaded on to the correct account held on NIRS to create a unique PAYE record. Where a new National Insurance number has been traced HMRC will notify individuals and employers of the correct National Insurance number via current channels. HMRC is currently exploring better ways to send these notifications out.
ES Asked if there are plans to discard the ninth character of the National
Insurance number.
HMRC was unable to answer that at this stage, but will establish whether
the ninth character of the National Insurance number will be used in the
matching process. HMRC also promised to write to employers when the National
Insurance numbers start going out.
The PAYE Service and PAYE Work Management pilot was designed to prove a limited amount of core functionality in advance of the October release, to better understand the potential impacts of Controlled Go Live on business operations and, following the successful proving of the new PAYE Browser, to commence rollout to over 27,500 staff across HMRC. Up to 50 operational staff in Sunderland and Portsmouth offices were involved using live environments.
The live pilot was an opportunity to prove IT solution of PAYE Service, build business confidence, test functionality and manage staff expectations, comparing old system with new while processing PAYE personal details and comparing coding and other work items.
The pilot has been invaluable in proving some core elements of the IT functionality, providing the confidence trigger for the rollout of the new (windows like) PAYE Browser and identifying areas for additional user support in advance of the October release.
P45 – there are some minor text changes to be carried out before the forms can be finalised. HMRC will be amending the parts 1A and 2 of the form to amend the section on Job Seeker Allowance to include the new Employment Support Allowance. HMRC will also be moving the text on Tax Credits from part 2 of the form to part 1A. This will have an impact on the technical specification for the plain paper P45 and HMRC hope to have a revised version of the specification within the next week or so.
P45 continuous (double sprocket) – HMRC has consulted a number of large employers over the proposed removal of the second column of sprocket holes from this form. Indications are that this will not cause a big problem. ES are happy for the inside column of sprockets to be removed but asked for the size of the form to remain unchanged to avoid automatic printing spilling out text boxes. HMRC will take away this action point and advise accordingly.
Test stationery for the P45’s is expected to be ready in June 2008.
ES queried a problem with employers receiving signed P46’s from their employees, where no box had been ticked, and what action they were to take in these cases. They also asked for suitable guidance for employers that include forms P46 in their contracts of employment.
HMRC will look at this and advise ES accordingly.
HMRC are working to step up communications to individuals, see also item 12, and employers to raise their awareness of forthcoming form changes; as ever they will welcome any suggestions ES might have.
Carter PAYE is committed to ensure diversity issues are identified and
taken into consideration when online filing becomes compulsory for small
employers in 2010 and are preparing a report which will explore the need
for exceptions to mandation for some small groups of employers, such elderly/disabled
employing carers, for example.
The consultative document is expected to be published in June 08.
HMRC presented a slide showing the PAYE Work Management cycle.
When the new PAYE Service is unable to automatically resolve a work Item,
this Item must be cleared manually by an operator. The PAYE Work Management
System [PWMS] is basically the national engine which collects and distributes
unresolved Work Items. We have identified over 140 different scenarios where
the PAYE Service will create a Work Item and pass this into the PWMS national
single ‘basket’ for manual clearance.
PWMS will prioritise Work Items as they enter the basket and send the next most urgent one to the next available operator who has the appropriate skill set – Role – for manual processing.
HMRC will utilise existing skills to allocate and redistribute roles to suit the new system.
ES asked how quickly HMRC can switch staff around should an emergency arise - such as the Tax Credits emergency last year. HMRC replied that the new system will enable managers to communicate new needs nationwide and reallocating resources in real time, much quicker than it currently does.
HMRC thanked ES for the useful feedback they provided over the online filing video advert for the Employer CD-Rom and presented ES an updated timeline of forthcoming communication events and initiatives.
HMRC again asked ES for their valuable opinion to help identify efficient ways to notify all employees of the changes over the next few months. It would be HMRC’s intention, for instance, to include a poster in September’s edition of the Employer Bulletin and to ask employers to display this on staff’s notice boards.
ES suggested that HMRC could also supply an electronic version of this poster for publication in the employers’ intranet and to industrial and commercial agencies. For communicating Student Loans procedural changes, ES suggested to use student Unions channels before the summer break.
For targeting other high turnover employees, ES suggested that HMRC should write to agents and hotel/catering employment agencies.
HMRC will contact ES shortly to ask for further suggestions for communicating changes to employees.
1) P46 – ES said that if a blank P46s have been sent (due to third party software glitch or operator’s error) a second properly filled one is rejected by the system.
HMRC will send a note on EDI, which dealt with this issue, to ES.
2) ES asked if HMRC plans to include a demo version of online filing system on Employer CD-Rom. HMRC will pass this suggestion to Customer Unit and said that a Learning Zone is already features on the CD.
3) Data dictionary – ES said that ‘last name’ heading is not helpful; ‘family or given name’ would cut data entry error rate. HMRC was told that department needs to maintain consistency of headings across all departmental forms, so it is unlikely it will change this in the near future.
4) Next meeting will be held on 25 June 2008, venue TBC. All dates of future consultations in 2008 can be found on our website.
Forum ended at 13.45
