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can you do Nil P35 online??
Posted by spayne on Wed, 07/10/2009 - 09:10
When the HMRC launched their online end of year P35 routine I remember trying to do some nil returns for a client - ie no P14s so nothing to report. The system would not let me so I did nothing
This year a different client with no P14 so I did not try to do a P35 online - Client has now got the £400 fine - I have appealed on the basis of the above
Am I wrong and/or out of date?
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You are correct - IMHO
I have filed nil returns online for companies, by showing the director as an employee with nil income - useful in extracting online filing incentives :), couldn't get it to work for non companies.
It is a bit of a flaw in the system, because businesses may well have periods with no staff, and therefore no P35 requirement, but wish to keep the PAYE scheme open in anticipation of this changing!
There should be a facility to notify HMRC that PAYE scheme is dormant to avoid the waste of time paperchase that ensues in such circumstances.
I also think this should extend to Companies House with dormant companies being exempted from filing if they notify dormancy (may be on Annual Return)
It works for the CIS scheme so why not the above?
Nil P35
My client is a Limited company - does this make any difference?
ring hmrc paye
I come accross nil P35's regularly with new clients and especially where limited companies have had paye schemes automatically set up. A phone call to HMRC explaining that the P35 would result in the submission of a zero return enables them to change their record accordingly. HMRC do not have any facility to process a zero return! The scheme can still be kept live for subsequent years' returns. Hope this helps.
ring HMRC?
I am not sure how much luck the rest of you have with this idea. We took a P35 for another employer remove identifying data and filed in for new company. I have found a balnk form on the web, it is for 2007 but with some amendmends it is ok for a nil return http://www.hmrc.gov.uk/ebu/p35(2007).pdf.
We still receive receive P 35s for businesses that stopped payroll years ago. Sending in nil returns does not help.
Just notify them
There is no facility for filing blank P35's online, which would save lots of stress when clients receive the £400 penalties even though they are cancelled without too much drama. Last filing season I faxed the offices with details of a few clients who were registered as employers but didn't need to submit P35's. Only one ended up with a penalty notice and it will be withdrawn.
Sue Essery
We have had no problem with Nil P35's. We contacted the relevant tax offices and they sent us a blank P35 for the clients concerned these were completed as nil and signed by the client and returned to the tax office before the deadline. We have done this for the last couple of years with no problem. We deal with multiple tax offices so its not just one office accepting this.How we will fare next year when returns are submitted online I am not sure but we will cross the bridge nearer the time.
Since the system is fatally flawed...
... pay someone (director or whoever) £1 on the P14.
Get £75 back, which is nice.
Hardly ideal, but that's not our fault.
Pay someone £1 won't work
That won't work because a nil P35 is when there is no tax or NI paid not paying someone something and get back £75. Also no online filing incentive next year so no point!!
From 2010-11 zero P14s are permitted
From 2010-11 the online schema that third party payroll software developers (such as 12Pay) use to submit P35/P14 returns to HMRC will allow P35s with zero P14s to be submitted.
On-line filing of Nil P35's
I have filed nil P35's with no problem. you have to enter an'X' for the national insurance contribution letter and just answer all the questions with the appropriate zeros. I have only done this for limited companies though.
Monica James
Pay £1 and claim £75 incentive
Well a chartered accountant created 500 companies and tried to claim incentive. Here is a decision
http://www.financeandtaxtribunals.gov.uk/judgmentfiles/j4071/SPC00706.doc
HMRC made incentive payment for 33 companies before they realise that all 500 companies registered at the same address, had same director and had same secretary.
NIL for all
It would be helpful if NIL returns for Partnership / LLP SATR could be made online using the HMRC s/w, as well - I'm sure there are other NIL returns of other kinds that would also be useful to have available online.
online filing hmrc p35
the cash incentive ;offered to small employers less than 50 employees, for filing p35 and p14 online ended tax year 08/09, should be able to fill nil returns from 09/10. appeal on grounds there was nothing to report , earning too low for nics , tax and no expenses and benefits to report either
can you do Nil P35 online??
This has always fascinated me. I am an IFA (that's a posh name for an insurance salesman) NOT a Member of the identically named Inst't of Fin Accountants.
Why, if you have nil P35's does your customer (we call them customers NOT clients you see) have a PAYE Scheme in the first place; (paye compliance regime etc etc) not to mention your fees!
And if, (for some byzantyne reason known only to accountants) he has one , why would you NOT file a P35 to get the free state pension by paying just above the NIC rim thr'd? And edclaring it as such?
I am going off to sell another £100,000 term life policy, but I would realy LUURVE to know!
Why no salary
Dear IFA
1 Because he has other income taxed under PAYE
2 The company has losses and has no need to increase them
3 In prior years an (now) ex director was taking a salary
Best we stick to our own jobs eh!
A company might have CIS details but no employees
The P35 also shows CIS totals for the company. A company that employed CIS subcontractors but has no employees cannot file the P35 showing that because zero P14s is unnacceptable. We have clients with that problem right now. It will be interesting to see what HMRC tells them to do.
Defeats the Object of Online Filing
Although it is easy to write to, phone or fax HMRC to inform them of nil P35's, it does defeat the object of online filing when we cannot submit a nil P35.
The same thing happens with P11D's.
Surely it would be a lot easier for HMRC if they just accepted nil P35's filed online.
You do wonder however how many businesses submit their own returns and will pay a penalty without queston, so maybe that is a reason why HMRC do not accept nil P35's filed online.
my tuppence worth
I think a client is someone who engages the services of a professional, you see! :)
I think in the current climate there may be a number of businesses who had employees, no longer have employees but hope to in the future - so keep their scheme open as the inevitable cock ups by HMRC of shutting and then re-opening a scheme would be the final straw :D
Consistency?
Interesting from the replies that HMRC appear to be so inconsistent.
I have a limited company client that trades sporadically. It has never paid a salary and there is no intention to do so. HMRC have been informed of this but doggedly send a P35 out every year.
This year I actually read the instructions on the front of the form. They tell you to submit the form if certain conditions apply. The implication is that a nil return is not required to be submitted. Being a bit cynical I rang the issuing office to be told it must be filed to avoid a penalty. I pointed out the wording does not say this only to get the answer 'I know, but that's wrong'.
P35
I have been filing nil returns online by creating an employee with the name ' No Employees' no problems to date.
can you do Nil P35 online??
Ouch! Spayne's rebarbative reply that I 'should stick to my own business' (as an IFA), really hurt. i thought I was.I thoght everyone remotely concerned with financial services from FCA's to the bloke in Dixons who tries to sell you an extended warrnty on your Hoover knows this stuff. If I have transgressed some 'boundary' I apologise. Whilst sticking to my own last however, I downloaded a specimen P35 on the HMRC website. And it states thus:
"If you had to prepare a P11 deductions working sheet ....you are required to send":- blah blah blah...
"If you did not prepare a P11 deductions working sheet .....DO NOT SEND A RETURN"
Now, If I as an insurance salesan (sorry!IFA) sold your director client a wodge of life cover when he was already covered (say, under a group pension scheme) you would say that it was just to generate a wodge of wonga for myself, and give me a deservedly good kicking.
So whose been charging out time fees for this rubbish advice then?
Go and work at the coalface...
... before you criticise a miner.
Most nil P35 arise because HMRC, despite having been told many time over one is not required, still keep sending them out and if they are ignored then they are followed up by endless reminders and penalty notices.
HMRC's advice when asked will be to submit a nil P35.
Many accountants now seek redress from HMRC for this time, feeling that it not fair for the client to pay for unecessary work, and I am sure if answering honestly, most will admit to writing off swathes of chargeable hours rather than billing the client for such work.
So please, go and sell some more high risk; front fee loaded; long term investments to terminally ill octagenarians and leave accounting to those with more than a passing knowledge of the subject.
In respect of any instruction on any HMRC form, I will leave you with the words of St Bob of Geldof:
"Do you believe what you read?
No, I don't believe what I read."
Somebody's had their cage rattled!
I quote from AnnaKournikovasKnickers as I don't feel a private message is the appropriate response to a forum post.
"Firstly, like a lot of old greying accountants (your words) I have worked closely with over the years, you have blasted off a splenetic message without addressing the reference document, viz the actual HMRC instruction printed on the P60 that I quoted. Is it correct or incorrect?
In answer to your second comment. Things have moved on old chap. The old time 'Allied Crowbar' insurance salesmen have disapeared. We are now forced to be much more widely educated. AS WELL AS my own FSA required CPD, I personally attend more ICAEW/ CTA CPD seminars than 80% of the 1,800 chartered accountants here in Worcestershire. Fact. In fact, the unqualified attendees at these events usually outnumber the qualifieds.
Oh. By the way, before posting I also checked with HMRC PAYE compliance, + the HMRC employer's CD ROM (2009). They all confirm the statements in my postings."
1. Try and differentiate between tongue in cheek and splenetic - although it seems to be a lost art, a bit like the subtle but crucial difference between irony and sarcasm. Plus, I did address the reference document, what it says, and subsidiary reference material says is correct, but how HMRC apply this is a separate matter, and from long experience of doing as well as attending lectures, it is easier to send in a nil P35 even though it is not what you are supposed to do. My conclusion is that it is the HMRC officers who should be attending the courses, not the accountants, as most on here will testify that to diligently follow the prescribed procedures is a sure way to a nervous breakdown!
2. Tell that to the MoS financial pages, I think they would be out of business if that were the case.
On a separate but linked issue, a bit of consistency would be nice - no employees - no P35: no subcontractors, £100 per month fine for not filing a nil return!
Finally it is only a user name, not description - at least I hope I am not responding to a tennis players under garment :)
Now now folks...
Play nicely please.
Yes Miss
Sorry Miss
:)
P 35
This case is unique. Thanks for sharing.
P35
Not being an American, I have always thought that I have a well developed sense of irony. But yours passed me by, I'm afraid. However, you appear to concede that I have correctly interpreted both the law and HMRC instructions. Not having experience of what 'happens on the street' I defer to yours.
I don't know what 'MoS financial pages' means. Please enlighten
If you have actuaul cases that you feel were mis-sold by such as I, (as would be indicatd by your diatribe about us),I personally derive an income from pursuing mis-selling, particularly by banks and appointed representatives of insurance companies, on a no win no fee basis ( set a thief etc etc). If 'miss' will allow it I can let you have my contact details, but I don't want to get chucked off this site.
Finally, I detect a note of levity in your reference to my undergarments. You have obviously not looked on the TGE (Tokyo Garment Exchange) recently and seen the current traded price of same! How the provenace is proven will have to remain a closely guarded secret (geddit?).
Where's Swiss Toni when you need him?
Not "Ministry of Sound", but Mail on Sunday, the business and financial pages of which I had always believed to be well regarded by those working in finance, and champions of the mis-sold and mis-advised!
I have no specifics, I like to look after my clients - just as well I work in the home counties and not the shires.
It wasn't a diatribe about IFA's - think carefully about who cast the first stone! Accusing professional people of making up work to rip clients off is a serious allegation. As I intimated, I think many accountants would not charge for nil P35's, they just do them in the easiest way possible to get HMRC out their hair, which was the original point of this thread ( I certainly would not charge for something that takes less than a minute to write nil all over and stuff in an envelope if it meant I wouldn't be plagued by reminders, demands, penalty notices and threats of de-patellation by shot-gun from HMRC!).
The world be a far better place if we all did something useful and worthwhile, but the world turns the way it does and you've got to earn a living as best you can - I wouldn't however want to be up in front of the Mitchell and Webb "old ladies job justification tribunal", even less so as an IFA. :)
Law trumps HMRC computer system
The PAYE regulations do not require a P35 if there are no P14s needed. That's why the guidance says 'do not file'. The problem is the HMRC computer, which should allow a tick in a box to say 'no P35 or P14 due'.
Nil P35 returns
I always put the pay at 1p and the software seems to accept this
From 2010-11 zero P14s are permitted
It is true that from 2010-11 an online P35 can be submitted with zero P14's, but only if there are CIS deductions suffered by the company.
If Box 23 'Deductions made from subcontractors' on the P35 is zero and there are no P14's submitted the submission will be rejected. This facility has been added to allow the situation where a company has CIS subcontractors but no employees.
However, now there are no incentives to efile, it would be much easier if a nil return could be filed online, and I have been in many consultation meetings with HMRC where this has been suggested, but so far with no positive reponse.
Nil returns
Jeez, I do a couple of nil returns online. Only takes seconds for goodness sake and do them free!
Nil P35 and the fine
I notice that you say the client has received the "£400 fine". It is actually a £100 per month fine and I have successfully appealed against such a level of fine on the basis that it is inequitable to notify a tax payer that what they have done is unacceptable and to levy a fine by reference to the date when the Revenue get round to telling the taxpayer. At worst the taxpayer should have to pay £100 but only in cases where there is a failure by the taxpayer which he should have known about.
If the Revenue were to start waiting 12 months for example they would probably start to reduce the Chancellor's Nation Debt because then they could demand £1200 each time they got round to it. In my view if they want to charge you £400 they should have been issuing monthly reminders and demands each of which went unanswered.
I'm sure your appeal grounds are equally valid but I thought my experience worth mentioning.
Life Assurance Salesladies
Anna - if I was 20 years younger, you could have sold me a term assurance policy any time.
Sadly I'm not, so you can't.