ECH10100 - Employer Support Team - PAYE Settlement Agreements (PSAs)

A PSA is an agreement between an employer and HMRC where the employer meets the employees’ tax liability on items – usually expenses and benefits that are

• minor
• irregular or
• it is impractical to apply PAYE or
• it is impractical to apportion the value of a shared benefit across a number of employees.

Guidance on what can and cannot be included in a PSA is contained in the PSA Manual at PSA1050.

Where a PSA is agreed the employer must pay the tax and Class 1B NICs to HMRC by 19 October following the end of the tax year to which the PSA relates.

The EST/LBS tax specialist will

• deal with all unprompted PSA applications from employers
• deal with referrals from compliance officers (ECR308) following an intervention
• deal with irregularities arising from PSAs including issuing Regulation 110 Determinations where necessary.
• provide advice to Local Compliance staff and employers on PSAs.

Guidance on PSAs is in the PSA Manual.