Given the importance of HMRC to the work of payroll providers – we keep a keen eye on the agent updates that they issue, examining them for anything that may affect our clients and the service we offer.
Earlier today, HMRC issued their 67th agent update, which contained several points of interest. One of these relates to the introduction of Welsh rates of income tax. The update sets out how HMRC will identify Welsh taxpayers, by searching on their systems for those paying tax in the UK and whose primary (or only) residence is based in Wales, for more of the tax year than in any other home nation. Individuals accordingly identified as Welsh taxpayers will have the letter ‘C’ (Cymru) as a pre-fix on their tax code, with their status as Welsh taxpayers applying for the tax year in full.
The update also advises on spot checks being carried out by the Pensions Regulator, throughout the rest of the Summer and Autumn. These spot checks will examine whether the selected employers have been meeting their auto-enrolment obligations – with inspections taking place at short notice and a range of enforcement powers at the Regulator’s disposal.
PAYE settlement agreements are meanwhile referred to within the update. Indeed, it mentions how the PSA1 form governing these agreements is being amended to include the rates and threshold changes pertaining to Scottish income tax. The revised form requires those submitting it to confirm whether any expenses/benefits due are for a Scottish or non-Scottish taxpayer, thereby ensuring that accurate PSA details are received by HMRC.
The full update can be accessed here: https://www.gov.uk/government/publications/agent-update-issue-67
As one of the UK key Payroll Outsourcing players, we always ensure we’re up-to-speed with what’s new in the world of HM Revenue and Customs, picking out the bits our clients need to know and adjusting our own practices to reflecting changing official guidance.