PAYE92050 - Reconcile individual: posting P14 to individual record: PAYE Errors Unit (PEU)

If an employer asks for a direction under Regulation 72(5) Condition A because they have underdeducted PAYE tax in error, the papers and a summary of the facts should be referred to the PAYE Errors Unit (PEU) after following SPD 60. (This text has been withheld because of exemptions in the Freedom of Information Act 2000)

(This text has been withheld because of exemptions in the Freedom of Information Act 2000) 

The PEU will consider the employer’s request for a direction, based on the explanation given in regard to the error and will

• Issue a Refusal Notice if the explanation is not satisfactory that reasonable care to operate PAYE was made and that the error was made in good faith

If the Refusal Notice is not appealed within 30 days or is subsequently upheld by review or the relevant Tribunal, the PEU will

• Notify the decision to the submitting office

The employer should be pursued for any PAYE tax by DMB if the tax remains unpaid.

If the PEU accept the employer’s explanation about the error they will

• Issue a Direction Notice to the employee and send a copy to the employer

The PEU will hold the Direction Notice for 30 days in case an appeal is received. If the Direction Notice is not appealed or is upheld by internal review or at the Tribunal hearing, the PEU will

• Notify the decision to the submitting office
• Confirm that the employee should pay the PAYE tax as an underpayment

Appeals

If an appeal is received, the PEU Appeals Higher Officer will either

• Reconsider the original decision made and try to settle the appeal

• Send a letter, explaining HMRC view of the matter, offering a review and informing them that if they wish to take matters further they should notify the Tribunal of the appeal (see ARTG4220)