The partnership I work for is being bought by a national firm. All our employees will transfer under TUPE on 1 April.
Does anyone know whether I need to issue P45s to the employees or not?
Many thanks
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Maybe
As the national firm will have its own PAYE scheme, you would normally have to issue forms P45 for leaving your PAYE scheme. However, your circumstances seem to meet the conditions for a succession in which case, you would not need to issue forms P45. Presumably, you will issue forms P60 on your PAYE scheme.
Thanks Euan
I'm still very unsure. Whether or not a succession takes place seem to hinge on whether or not I choose to issue P45s or not, and whether or not I complete year end returns (and as this is my first year processing year end under RTI I'm not sure the software will give me any control over that!)
I may push this one on to the lawyers.
No P60s
The rules for a P60 are that they are given to people in employment on the 5th of April. In this case no-one will be in employment in your scheme on that date (having left on the 31st of March) so no P60s will be due from your PAYE scheme. Therefore if no P45s are issued either, employees will have no official record of their pay/tax in 2013/14.
The RTI implications are discussed here http://www.hmrc.gov.uk/manuals/pommanual/PAYE30009.htm
Unless....
That makes sense, Neil, unless the new company takes over the PAYE scheme under succession, as per Euan's link? http://www.hmrc.gov.uk/manuals/pommanual/paye30045.htm
In which case it says the new company provides P60s.
And whether or not it is succession hinges upon whether or not I issue P45s, so it's back to square one!
I have a cunning plan
... to avoid the need for the national firm to input the information for your employees into their payroll system, just to print forms P60, before clearing everything down for the start of the new tax year..
Apply for a succession with effect from 1st April, so need for you to produce and for the national firm to input forms P45. Change the PAYE scheme references on your payroll system to those of the national firm and print two copies of forms P60 for your employees - give one copy to the employees and the other to the national firm for them to set up the standing information for your employees on their payroll system for 2014/15. Do not file an EOY return from your payroll software - the one that the national firm files will cover all employees on their PAYE reference at 5th April.
Come to think of it - does the national firm have a centralised payroll function with a single PAYE scheme? They might want you to carry on running the payroll for your office because it is quite possible to file multiple FPSs for the same PAYE scheme. Or they might even have multiple PAYE schemes.
First, thanks, Euan, for putting so much thought into my problem. It is much appreciated.
In the end I rang ACAS. They confirmed that it is perfectly normal to issue P45s in this situation. The employee's TUPE rights will be preserved, and it doesn't affect continuous service in any way. So the plan is to issue the P45s, and the national firm will enter us all for 5 days and do P60s.