PAYE21015 - Employer records: maintain employer record: cancellation of an employer record

An employer record may be cancelled only if it was set up in error, for example

• There is a duplicate employer record elsewhere
• The employer record was opened in error
• No individuals were employed by the business

The employer record cannot be cancelled if any of the following apply

• The employer has made a claim for CIS deductions suffered
• Any linked employees are present under that employer reference
• Certain indicators are held on the employer record. These will be highlighted by the computer when any action is taken to cancel an employer record
• The employer record has been merged, succeeded, or transferred
• A skeleton employer record exists

An employer record must not be cancelled if the following are shown on the BROCS record for any year

• Format 1 (Employer Data General Summary)

• Archived sub-account

• Format 3 (Postings Summary)

• Payments

• Format 9 (Designatory Data for ASN)

• TC EMPLOYER
• Dormant indicator
• Return received and date

When you are satisfied a record should be cancelled, follow the Action Guide at PAYE21016.

Cancelled in error

Circumstances may arise where a cancellation date was entered incorrectly or was not appropriate.

In this event the cancellation date cannot be changed. The employer record must be reopened. Further advice is available at PAYE21205 

Interaction with EDI Live Service Team - EDI indicators

If EDI indicators are present on an employer record and an attempt is made to cancel that employer record you will be prevented from doing so. As a result a work item will be created on the ‘EDI Cess/Canc Exceptions’ work list. This work list is only available to the EDI Live Service Team who should contact you to establish the reason for attempting to cancel an employer record when EDI indicators are present.

Linked Employees

There may be occasions where you want to cancel an employer record but employees or tax credit applicants have been linked to that employer record in error. If this arises you will not be able to cancel the employer record.

You must

• Enter a cessation date
• BF the case until the end of the year

And at that point

• Use Function AMEND EMPLOYER INDICATORS to set the COYO indicator for the year

You should bear in mind that if you do need to follow this guidance a return will be automatically issued in these cases.