PAYE72060 - PAYE operation: payments for PAYE purposes: principal civil service pension scheme

Details of the Principal Civil Service Pension scheme are given on the HR & Learning web site. The pensions for both widows and children are assessable as pension income (see Employment Income (EIM) Manual at EIM74009).

In the short term, pensions to most widows and some children equal the deceased's rate of pay. At first they are nearly always above the PAYE threshold.

PAYE procedures for widows and orphans

The payer of pensions to widows and children of civil servants, should send a form P46 to the appropriate local HMRC office. Tax is deducted on the emergency code until a correct code is sent. You must issue a correct code as soon as possible.

In some cases responsibility for payment of pensions depends on the arrangements between the employer and the pension scheme. Sometimes the employer may pay

• Short term pensions
• Initial pensions to widows with rights to continuing pensions

In these cases normal PAYE procedures apply. Where there is a right to a continuing pension which is to be paid by the pension scheme, the employer will complete form P45, sending

• Part one to the Local HMRC Office
• Parts two and three to the pension scheme, not the taxpayer

The pension scheme must use the code shown on form P45 on a Week 1 / Month 1 basis. When the widow's or orphan’s records are received, the cumulative basis should be restored if possible.