RTI + Employers Allowance

claiming EA

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Company uses small bureau to process payroll [ circa 15]  The detail is presumably RTI.   The company is paying the tax ERS + EES off of the summary report which is the months respective monthly cums.  How does the company then benefit from the  Employers Allowance – as by knocking off £ 3k from the current due would leave a year end rec diff @ HMRC ? and the mother of all issues therefrom

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By hje
10th Feb 2017 10:23

EPS

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Euan's picture
By Euan MacLennan
10th Feb 2017 10:52

The "small bureau" should have claimed the EA on an EPS. They should then provide the company with a payroll summary showing a deduction for the EA until the £3,000 has been used up or a PAYE payslip report net of the appropriate EA. The fact that the "summary report" does not show any deduction for EA suggests that the bureau may not have claimed the EA.

So, the company should check with the bureau that it has indeed claimed the EA and if not, tell them to do so immediately. If this is the case, the company has no option but to reduce its 3 remaining months of PAYE payments for 2016/17 by £3,000 in total. If it ends up with overpaid PAYE, it or the bureau will have to claim a refund after the final RTI submission for 2016/17.

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By coops456
10th Feb 2017 11:41

What Euan said, with the caveat that depending on the salaries of the 15 staff and if the company has been trading all year, the EA may have already been used up.
If this is the case then the EA deduction would only show on summary reports from earlier in the year.

If necessary HMRC will carry forward an overpayment into 2017/18 - which is often easier than trying to get it refunded.

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By NYB
13th Feb 2017 11:09

Depends on payroll software too. Mine has a box to tick at beginning of tax year to claim and then p30 reflects the allowance month or quarterly until it's used up.

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RLI
By lionofludesch
13th Feb 2017 11:34

If the payroll bureau isn't claiming Employment Allowance, simply change to a new bureau.

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Replying to lionofludesch:
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By psimonparsons
13th Feb 2017 20:27

It would be wrong for the bureau to assume entitlement.

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Replying to psimonparsons:
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By Cheshire
13th Feb 2017 23:06

It would be wrong for the bureau to do nothing. Besides its not particularly difficult to work out if there is entitlement or not.

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Replying to psimonparsons:
RLI
By lionofludesch
14th Feb 2017 07:33

psimonparsons wrote:

It would be wrong for the bureau to assume entitlement.

Or to assume there was no entitlement. As Cheshire says, the bureau would have all the relevant facts to hand.

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By psimonparsons
13th Feb 2017 20:22

You indicate entitlement to the Employment Allowance once on the Employers EPS. Then reduce your NI bill by the £3,000 in the monthly pay over. The EA actually has little to do with the payroll, it is not part of the Full Payment Submission.

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