PAYE65025 - employment maintenance: employment agencies: agency schemes - forms

Employment Maintenance forms P45(3) and P46

Generally, agencies submit starter forms, P45(3) and P46, when the taxpayer

• First registers with them

Instead of

• When the first paid employment begins

Every effort should be made to persuade the agency to submit these forms only when payment is made for the first time. This would have a positive impact on the reduction of open cases and avoid records being created and / or moved between Processing Offices unnecessarily.

Employment Maintenance forms P43(T) and P45(1)

Agencies should prepare form P45 when the taxpayer

• Asks for one

Or

• Permanently ceases to work for the agency

What happens in practice is the taxpayer starts a new job or moves to another agency, without a P45. The taxpayer will then usually tick and sign Statement B of the form P46 which is submitted by the employer. This results in live employment records being transferred incorrectly and the unnecessary production of form P43(T).

The computer produces forms P43(T) automatically when

• Function MA is used

And

• Leaving details from the previous employer are not held on the taxpayer record

Clearly this is an unsatisfactory but not uncommon scenario. To avoid this, agencies are required to review the workers on their books at regular intervals of no more than three months.

Note: You can try and persuade agencies to do this. You cannot insist on it

Form P625

This form is designed to help agency workers help you. It provides them with useful hints to ensure PAYE operates as smoothly as possible. On the reverse is a table, which enables them to keep a record of their various jobs.

Agencies should be encouraged to issue every taxpayer with a copy when they first register. Alternatively you may offer these directly to agency taxpayers, or issue them on request. Where the taxpayer has a Self Assessment record, completion of form P625 is unnecessary.

Any repayment due will be claimed in the usual way on the taxpayer’s SA return after the end of the tax year.

Leaflet NIC series CA 25

NICO produces this leaflet for agency workers to help them determine their National Insurance Contribution class. This leaflet also provides other useful general information about agency employments.