PAYE Procedures – Mandatory electronic payments in Construction IndustryFriday, May 7th, 2010
In a news item in March, we explained the changes made by PAYE amendment Regulations to the procedures for identifying “large” employers for the purpose of mandatory electronic payments. Employers with 250 or more employees are required to make their monthly payments electronically and the requirement to do so has, up to the current tax year, been fixed by means of an e-payment notice issued by HMRC to the employer in advance of the relevant tax year. No such notice will be issued in advance of the 2011/12 tax year and employers will have to decide for themselves whether or not they are “large” employers for this purpose.
Equivalent changes have now been made to the Income Tax (Construction Industry Scheme) Regulations 2005. Contractors in the Construction Industry who are large employers must also identify their liability to make their contract payments electronically and ensure that the payments are cleared into HMRC’s bank account by the 22nd of each month.
Contractors who are also employers are subject to the new penalty regime that came into effect from April 2010 for all employers in respect of late PAYE payments. Consequently, the surcharge regime that applied only to large employers who default in their payments also no longer applies to large employers in the Construction Industry.
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