Simplified PAYE Deduction Scheme – September increase in the personal tax allowanceMonday, July 14th, 2008
In response to a question, HMRC has provided the following statement concerning the way in which the September increase in the personal tax allowance will be applied to employees who are paid using the Simplified PAYE Deduction Scheme.
“We will be issuing new P12s showing the revised tax codes during the period 26-29 August. The P12s will be issued with a covering letter that explains to the employers what they have to do. We are not issuing a revised P16 booklet as tax tables used for these PAYE schemes are not changing.
Every individual taxed under the Simplified PAYE scheme will get a revised P2, which will include an explanation of why they are getting a new tax code. Tax codes will be issued from 24 August.
The allowances are backdated to April but the nature of the simplified scheme means that we will not expect these employers to deal with any repayments. Instead, HMRC will deal with any refunds due and we will be asking employers to send us the old P12 as soon as they have made the last payment using the old tax code. We recommend that employers send us the P12s by the end of September.
We are looking to choose the earliest practical implementation date in September so that as many employees as possible can benefit from the changes in September.”
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