In-year Online Update
From 6 April 2009 if you have 50 or more employees you will have to send your in-year employee starter and leaver information (forms P45(1), P45(3) and P46) and similar pension information online. And all employers will have to do this from 6 April 2011.
Sending in-year forms in April 2008
For a short period from 6 April 2008, while we test some new IT processes, you may not be able to send us forms P45, P46 or similar pension information over the Internet using third party software or our Online Return and Forms – PAYE product. We will let you have details nearer the time.
Customers who use Electronic Data Interchange to send these forms will be unaffected.
These delays will not affect the submission of your Employer Annual Return (P14s and P35) or Returns of Benefit in Kind (P11D/P9D).
Remember, even if you are unable to send your forms to us, you must still give your employees forms P45 parts 1a-3 when they leave.
Payments made to an employee after a P45 has been issued
Sometimes, employers have to make a payment to an employee after giving
them their P45 parts 1a-3. It is important that you do not give
your employee a second P45 showing code BR and the additional
pay and tax. If this is given to a new employer it may result in excessive
tax deductions.
The correct procedures when an employee leaves are outlined in booklet
CWG2 (2008) – Employer Further Guide to PAYE and NICs.
New quality checks from April 2008
From 6 April 2008, we will be bringing in new quality checks for online in-year forms P45(1), P45(3) and P46.
Changes from April 2008
From April 2008 we have agreed a relaxation and some changes to the P46 process. The same relaxation applies to the information required on form P38(S). The student employee will no longer have to complete our pre-printed form P38(S) with the relevant information. You can ask for the information that is required on the P38(S) in a way that best suits you but, again, you must be certain that the information was supplied by the student and not anyone else, and you must keep a record of the facts and how you got them.
Date of birth and gender mandatory
As part of the new quality checks mentioned earlier, you will have to show the employee’s date of birth and gender on all forms P45(1), P45(3), P46 and similar pension information from 6 April 2009.
You will need to check now what details you hold about your employees so you can fill in any gaps before April 2009. The date of birth helps us to match employee information with our records, especially if there is no National Insurance Number (NINO) or it is incorrect.
Changes to form P45
We are making changes to form P45 so that it includes new mandatory fields for date of birth and gender. Changes to the online form will be made in April 2008 and we will introduce the new paper version of the form in October 2008.
New form P46(Pen)
In April 2009 we will be introducing a new paper form P46(Pen). The form, for new pensioners, will replace the P160, P46 and P45(3).
Local practices
Because of the changes we are making to PAYE processing, certain local practices set up between tax offices and, predominantly, large employers will need to stop. These local practices have built up over a number of years by agreement with local offices.
The main local practices are:
- not following the P46 procedures where forms P45 not received
- not using Code BR (Basic Rate) as the form P46 default
- not providing starter information when relevant income thresholds are reached
- sending data on CD-ROMs. Do not do this. We cannot process CD-ROMs and sending data on CD-ROMs does not meet the online filing requirements.
- If you are a pension provider, do not use a spouse’s NINO. In the early 1970s pension providers were asked to use the spouse’s NINO when a widow or widower became the ongoing recipient of a pension. You must now use the individual’s correct NINO so that we can match that person’s information with our records.
Changes from April will see the end of these local arrangements and we will discuss this with you if you are affected.
Getting National Insurance numbers (NINOs) right!
In preparation for moving all our PAYE records to our National Insurance computer system, we will be trying to trace the actual NINO for those individuals who have a ‘Temporary Reference’ number.
Where we do trace it, we will tell individuals their NINO and advise them to use this in future dealings with us.
We will also send a form P46-5T to the employer telling them the NINO, which must be used in all future dealings with us. You should deal with these forms promptly, to help make sure your employees’ records are correct.
We are sorry that these notifications will be sent on paper, rather than online. We are looking at batching them, so that you get one bulk issue for all employees affected, rather than individual envelopes.
Do you need help making the switch to online?
We have specialist people all over the country who can give you all the support and advice you may need.
