SE42240 - Emoluments from offices and employments: basis of assessment - link between the basis of assessment and the operation of PAYE

Section 45 FA 1989 and Section 203A ICTA 1988

The definition of the meaning of “payment” for PAYE purposes is the same as the definition of “receipt” for the purpose of assessing money emoluments. This ensures that in any given year, as far as possible, the amount on which an employee is assessed is the same as the amount on which the employer is obliged to operate PAYE.

Subject to the exception at SE42250 (payments chargeable under Section 148 ICTA 1988), the guidance on the meaning of payment and receipt at SE42260 onwards applies both for assessment and self-assessment purposes, and for the collection of tax under PAYE.

Note though that PAYE applies to any payment of Schedule E income, not just to emoluments from offices and employments. So the PAYE rules about payment apply to Schedule E income such as pensions as well as to emoluments of employees and office holders.