PAYE20031 - employer records: set up employer record: election for separate schemes – appeals (Action Guide)


To deal with an appeal against an improper purpose notice, follow steps 1 - 16 below. The guide is presented as follows

Initial actionStep 1
Acceptance of the appealSteps 2 - 5
Late / unacceptable appealsSteps 6 - 7
Withdrawal of appealSteps 8 - 9
Appeal referred to the CommissionersSteps 10 - 11
Commissioners DeterminationsSteps 12 - 16


For details of how to access any of the Employer Business Service functions use the [Index of Functions] button on the left of the screen.

Initial action

  1. All appeals must be dealt with as priority and submitted to an Inspector for guidance

Acceptance of the appeal

If, after submission, it is agreed that the appeal be accepted


  1. Use Function EMPLOYER SET UP to open a new employer record

See the Action Guide at PAYE20136

  1. Use Function AMEND EMPLOYER SCHEME HISTORY to set the dormant indicator for the current year and make the employer record active from CY+1

  2. Write to the employer and advise them

  • That the improper purpose notice is withdrawn
  • That the appeal is settled under Section 54, Taxes Management Act 1970
  • That a new employer record has been opened which will be active from the following 6 April
  • Of the employer reference allocated to the new employer record

And remind the employer that

  • Forms P45(1) are to be issued after 6 April for those employees moving to the new employer record
  • Forms P45(3) are to be sent showing the new reference
  1. Use Function AMEND EMPLOYER NOTES to
  • Record receipt of the appeal
  • Record the date appeal was settled

Late / unacceptable appeals

If the appeal cannot be accepted either because it is late or the grounds of appeal are unacceptable


  1. Write to employer and

  • Explain the appeal cannot be accepted, giving the reason(s)
  • Ask the employer to withdraw the appeal
  1. Use function AMEND EMPLOYER NOTES to

  • Record receipt / progress of the appeal and if the appeal is
  • Withdrawn go to step 7
  • Not withdrawn or the employer does not reply go to step 9

Withdrawal of appeal

  1. If the appeal is withdrawn write to the employer and acknowledge the withdrawal of the appeal

  2. Use Function AMEND EMPLOYER NOTES to record the date the appeal was withdrawn

Appeal referred to the Commissioners

  1. When an appeal is neither accepted or withdrawn it should be referred to the Commissioners for a decision
  • Pass details of the appeal to the person responsible for maintaining the Commissioner’s lists in order that the case be listed
  • Write to the employer advising that the appeal is to be heard by the Commissioners
  1. Use function AMEND EMPLOYER NOTES to record that the appeal has been listed for hearing by the Commissioners

Commissioners Determinations

  1. If the appeal is denied by the Commissioners

  • Write to the employer explaining that the appeal has been denied
  • Give the Commissioners reason(s)
  1. Use Function AMEND EMPLOYER NOTES to

  • Record date appeal denied
  • Reason(s) why the appeal was denied
  1. If the appeal is upheld by Commissioners

  • Follow the guidance at steps 2 and 3 and then
  1. Write to the employer and
  • Explain that the appeal has been upheld by the Commissioners
  • Tell them that a new employer record has been opened which will be active from the following 6 April
  • Tell them the employer reference allocated to the new employer record
  • And remind the employer that
  • Forms P45(1) are to be issued after 6 April for those employees moving to the new employer record
  • Forms P45(3) are to be sent showing the new reference
  1. Use Function AMEND EMPLOYER NOTES to record the date the appeal was upheld by the Commissioners