PAYE73001 - PAYE operation: simplified deduction schemes: introduction

Employers of certain employees are allowed to operate a simplified form of PAYE. This involves a simplified procedure for deduction of tax, on a non-cumulative basis. Employer sections set up and maintain employer records for simplified deduction schemes on the Employer Business Service (EBS) under scheme type DOME. Guidance is available to Employer sections in subjects

• ‘DOME Scheme - Domestic (Simplified Deduction Scheme)’ at PAYE20085
• ‘Maintain DOME Schemes’ at PAYE27010

This section gives advice to PAYE sections.

Under Regulation 34 the responsible processing office may allow the use of the 'Simplified PAYE Deduction Scheme' to deduct tax and NICs provided that all of the employees in the scheme are personal and domestic employees of the employer and are employed

• To assist a disabled employer with their business, profession or course of study, which the employer would not be able to carry out without the assistance of the employee

Or

• At the employer’s home to provide personal or domestic services to the employer or the employer’s family. For example, a gardener or nanny

Forms P45, P46 and other movements forms are not to be used for changes of employment if the employer is using the simplified deduction scheme.

Form P6 is not used. Card P12 is used instead. Issue of a fresh card P12 is necessary when the code is changed.

If the employer is receiving funds from both the Direct Payment Scheme and the Independent Living Fund, the payments should be brought together in a single scheme.