P11Ds and working sheets, advisory fuel rates, Class 1A overpayments, NICs Holiday, RTI, Debt Arrangement SchemeFriday, March 4th, 2011
There are a number of important matters to consider this week, including errors on P11D working sheets, new advisory fuel rates in between the normal review dates, and the opportunity for employers to recover some overpaid Class 1A NICs – if they can afford the time and effort required to make the claim!
A few words about overpayments. The most common questions from employees on the Payroll-Help Forum relate to deductions from their pay. There have also been many such questions posted in response to an article on the subject.
But employers also have great difficulty handling overpayments, and not just because of the legal issues on unlawful deductions. Should overpayments be corrected in the payroll as soon as they are discovered, or should corrections only be made once the overpayment has been recovered? These are the issues currently under discussion on the Forum pages here and here. HMRC’s guidance is almost non-existent and it is interesting to see a call for clarification from HMRC on this subject in the CIPP’s new response to the RTI project.
The second of the two topics mentioned above is looking at what can be done in advance to prevent overpayments, particularly where monthly-paid employees are paid earlier in the month for work they have not yet performed. I have raised a “devil’s advocate” question – why should monthly-paid staff be paid within the month they perform the work – why not in the first week of the next month? I’m self-employed and get paid anything up to, hopefully, 28 days after I do my work – so I have to arrange my financial affairs accordingly. Why should employees be paid before they do the work? Tell us what do you think?
In addition to the forum questions we have our FAQ page, with this week’s article: How is the “relevant date” for calculating statutory redundancy pay determined? well worth a look if you are having trouble in that area.