PAYE42031 - employer returns: capture employer return – up to 2004: pre capture checks - up to 2004 (Action Guide)

Note: This Action Guide should be used for tax years up to 2003/04 only.

When you are required to capture an annual return, follow steps 1 - 42 below. This Guide is presented as follows

Initial action	Steps 1 - 5
Form P35(EP)	Step 6
Form P35(TAS)	Steps 7 - 10
Form(s) P14	Step 11
Form P35(PS)	Step 12
Form P37	Steps 13 - 20
Form P35 (Offshore Protocol)	Step 21
Form CIS36 / SC35	Step 22
Form P35 or P35MT	Steps 23 - 40
Notes made whilst recording receipt of the return	Steps 41 - 42

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

If you are reviewing form(s) P14 only go to step 11

Otherwise

1. Check that the return has been signed, recorded as received and is an official P35 employer annual return
   
   

2. Use Function VIEW EMPLOYER INDICATORS to identify whether the year related UNSIGP35 indicator was set for the previous tax year
   
   

Otherwise

3. Use Function AMEND EMPLOYER INDICATORS to set the year related indicator UNSIGP35 for the year on the return
   
   
4. Photocopy the return
   
   

And then

5. Your next action depends on the type of return held
   
   

Form P35(EP)

6. Sort the forms P527 and / or P528 into alphabetical order, these must be sent to the PAYE section after capture
   
   

Note: These forms do not need to be counted for capturing purposes

Form P35(TAS)

7. Review the entries on the back of the P35(TAS) to identify
   
   

8. Compare these figures with the entries made on form(s) P440
   
   

9. If you have established that some contracts are missing you must write to the employer to request that the missing details are reported on an additional P440
   
   

Note: When this information is received it must be dealt with as an additional return

10. Find the employer-related electronic file 'Taxed Award Schemes'
    
    

Otherwise

And then

Form(s) P14

11. Complete a form P37, using green ink, as follows
    
    

Form P35(PS)

12. Review all form(s) P14 to identify those which do not have 'X' entered in the box 'NI Contribution Table letter' on the P14
    
    

Form P37

13. You must ensure that you hold all the cards P12 for each employee
    
    

14. If more than one card P12 is held for any employee add the figures on each P12 to reach a total figure for each quarter
    
    
15. Review the NIC table letters shown at the totals for the quarter
    
    

Otherwise

And

16. Make an arithmetic check of each column. If the employer has not entered a total for each column add up the amounts and use green ink to enter these now
    
    

Otherwise

And

17. Use green ink to complete a form P14 for each employee for whom you hold a P12
    
    

18. Separate the P14(s)
    
    

19. When using Function CAPTURE EOY RETURN DETAILS to capture a return you will be required to enter the number of returns or P14s received
    
    

Note: Each multiple of 300 forms P14 is equal to one bundle. Where there are 300 P14s or more, a P130B sheet must be completed for each bundle of 300 and the remaining balance. For more information see PAYE41031

20. Use the information held on the Pro-forma P14 to complete the back of the P37
    
    

Then

Form P35 (Offshore Protocol)

21. Review the front of the return to identify if questions 1 to 3 have been answered
    
    

Otherwise

Form CIS36 / SC35

22. Review page 2 of the CIS36 or the front of the SC35 to identify if the questions have been answered
    
    

Otherwise

Form P35 or P35MT

23. Check the return for an entry in the Total Tax Credits Paid box
    
    

Otherwise

24. Check the amount of tax credits the employer was authorised to pay to their employees. Note: If a transfer, merger or succession has taken place you must add together the tax credits authorised for each employer reference
    
    

25. If TCS shows 0.00, no PVE has been authorised and you must make one attempt to telephone the employer for an explanation of the discrepancy
    
    

26. If the employer confirms that the figure entered on the return is incorrect and no tax credits were paid
    
    

27. If the employer confirms that the return is correct but tax credit details are held against a different employer reference on TCS
    
    

28. Review the return to identify if questions 1 to 6 have been answered
    
    

Otherwise

29. Use Function VIEW EMPLOYER INDICATORS to identify if the year related indicator UNQUEST was set for the previous tax year
    
    

Otherwise

30. Photocopy the return
    
    

31. Use Function AMEND EMPLOYER INDICATORS to set the year related indicator UNQUEST for the year on the return
    
    
32. Photocopy the return
    
    

33. Your next action depends on the type of return that you are reviewing
    
    

Otherwise
When using Function CAPTURE EOY RETURN DETAILS to capture a return you will be required to enter the number of returns or P14s (worksheets in the case of form P35 (Offshore Protocol)) received

Note: Each multiple of 300 forms P14 / worksheets is equal to one bundle. Where there are 300 P14s or more, a P130B sheet must be completed for each bundle of 300 and the remaining balance. For more information see PAYE41031

34. Retrieve the 'Electronic P14 Register' employer-related electronic file
    
    

35. Compare the totals shown on the form P35MT against the totals shown on the Magnetic Tape Invoice
    
    

36. Check the 'Reporting End Of Tax Year Data Electronically' list to see how many invoices are expected and whether they have all been received
    
    

37. In the event that the figures do not agree you must pursue the discrepancy
    
    

38. At the BF review send a reminder to the employer and BF your papers for a further 4 weeks
    
    
39. At the BF date if there is no reply you must
    
    

And

40. When you receive an explanation of the discrepancy from the employer you must review the information
    
    

Notes made whilst recording receipt of the return

Various notes may have been made on the return when checking prior to recording receipt of the return and whilst recording receipt of the return

41. You must review the return to identify whether any notes have been made
    
    

42. In all cases you must review the notes made and then
    
    

And

The tables below tell you what actions you must take for each message shown. The messages are grouped into the following areas

Scheme Status

This area covers

• CEASED
• PSC
• SUCCESSION

Non year related indicators

This area covers

• P229
• AMSO
• ENFORCE
• POST
• SPEC

Year related indicators

This area covers

• 87X
• C154
• ADVANCE
• AUDREP
• INSPRUL
• LUMPSUM
• POTREG49
• RECPRO
• REG49DET
• RNA
• TRADISP
• WRONGOP

Scheme Status

Scheme Status	Action
CEASED	Is there a note on the return that confirms the Debt Management Office has already seen the form? Yes - continue to capture the return No - pass the return to the Debt Management Office for their review
PSC	Do you hold both return forms P35 and CIS36? Yes - proceed to capture the returns No - search for the outstanding return from those on hand If the other return is not found, capture the return received but ensure you Set the Inhibit UP/OP indicator whilst capturing Do not enter any details relating to the other return. For example if CIS36 is missing do not capture the box showing CIS36 tax deducted on the P35
SUCCESSION	Make a note on the top of the return ‘Succession’ in red Obtain all return forms for the year of succession Use Function VIEW EMPLOYER SCHEME HISTORY to determine the status of the employer record for the year of the return If the employer record has been ‘ succeeded by’ another employer reference Ask Banking Operations to reallocate all charges for the year of succession to the correct BROCS record And Send the return(s) to the correct office with a note of the action taken If the employer record has been ‘ transferred from’ another employer reference Use Function VIEW BROCS to check that charges have been allocated to the correct BROCS record for the year of the return If monies are still allocated against the old BROCS record send a memo to Banking Operations requesting that the monies are reallocated to the new BROCS record Otherwise Use Function AMEND EMPLOYER INDICATORS to unset the CIS36 / SC35SUCC for the year if necessary (CIS36 or SC35 only) Use Function CAPTURE EOY RETURN DETAILS to process the return(s) in the normal way

Non year related indicator

Indicator	Action
P229	Link the return with the P229 Enter the pay and tax details Return the P229 to the PAYE section Note P14 ‘P229’ in red ink
AMSO	Note return ‘AMSO’ in red ink If you hold a P38A note its receipt in the employer-related electronic file ‘Market Research Employers’
ENFORCE	Take no further action
POST	Use Function VIEW EMPLOYER NOTES, check the employer record pad and post on hand to review the information recorded Identify why the indicator was set Take any urgent action needed prior to capturing the return
SPEC	Use Function VIEW EMPLOYER NOTES and check the employer record pad to review the information recorded Identify why the indicator was set Take any urgent action needed prior to capturing the return This may include action if SPEC was set for Employees Seconded Abroad

Year related indicator

Indicator	Action
87X	Take no further action
C154	Take no further action
ADVANCE	Use Function VIEW BROCS (Format 3 - Postings Summary - code PAD) to identify the total of advances made for employee refunds Compare this with the return figure If the figures are the same – write ‘OK’ in green next to the figure on the return If the figures are not the same – write ’Employer has made an error in accounting for advances’ in green on the top of the return
AUDREP	Review the report from the Employer Compliance Office (ECO) Has the employer carried out the ECO instruction If so – continue to capture the return If not send a report to the ECO giving details of the employer’s failure to comply
INSPRUL	Use Function VIEW EMPLOYER NOTES and check the employer record pad to review the information recorded Where you establish that the employer has not carried out the Inspector’s instruction Send a report of your findings to the PAYE section
LUMPSUM	Use Function VIEW EMPLOYER NOTES and check the employer record pad to review the information recorded. Review any report from the PAYE section to identify the employee Find the microfiche entry / P14 for that employee Use the tax tables to check that the correct tax was deducted If there is any discrepancy notify the PAYE section
POTREG49	Note the return for immediate capture
RECPRO	Take no further action
REG49DET	Consider if a Regulation 80 Determination is appropriate
RNA	Contact the employer Ask for the amount of any refund not made Confirm this was included in the total tax for ‘This employment’ on the P14 / microfiche BF your papers for 4 weeks Continue to capture the return If the employer confirms the refund not made is included on the P14 / microfiche Attach the reply to the return If the employer did not include the refund not made on P14 / microfiche Prepare a Pro-forma return and P14 and capture this as an additional return
TRADISP	Make a prominent note to carry out tax table checks on all P14s after the return has been captured
WRONGOP	Make a prominent note to carry out tax table checks on all P14s after the return has been captured