PAYE27025 - employer records: maintain schemes: maintain scheme type

You may be advised that an employer or contractor has changed their circumstances which has resulted in a change in the type of employee they either now employ or no longer employ.

When this happens you must review the employer record and make any necessary changes to it. Changes may also be needed to the type of stationery that the employer or contractor completes, but this will be dependent on when the changes took place.

You must also ensure that you fully advise the employer or contractor of the effect of their new scheme type. This may include

• Revised employer reference
• Revised annual return
• Revised tax tables
• Ability / inability to file online
• Change of scheme type to or from one that is excluded from the need to complete mandatory online filing

You may be prevented from changing the scheme type in the following circumstances

• The employer record contains details of CIS deductions suffered from a captured return but the scheme type chosen is not one which supports CIS deductions suffered
• The employer record has tax credit basis employments attached to it but the scheme type chosen is not one which supports the payment of tax credits

There will generally be 11 changes of scheme type that you are likely to come across. PAYE27026 lists the Action Guides available for this subject.

Note: The Employer Business Service (EBS) automatically generates employer referencing for any new employer records that you create.

This new type of referencing does not allow you to use the prefix DP for DP scheme types or the NI suffix for DCNI scheme types. Any changes to these scheme types will require you, in the first instance, to create a skeleton employer record using Function MAINTAIN SKELETON EMPLOYER.

This will then enable you to amend the employer reference manually by omitting either the prefix or suffix as necessary. An example of this can be seen in the Action Guide ‘Change Scheme Type DP to DCNI’ PAYE27028.

Any other changes of scheme type that have not been covered in specific Action Guides would normally be due to an employer record being set up as a particular scheme type in error. If you do come across this situation then you will need to look at the Action Guides relating to the scheme types you are presented with for guidance along with the System Help, which is available to you at function, screen, field and error message levels.