I'm putting together the 2013 SATR for a new client who is sole director of a limited company.
Key facts:
As at 31/7/12 (company's year end) previous accountant credited small salary (at LEL) to DLA.
When filing PAYE returns to 5/4/13 no P14 was filed for the director (but were filed for the employees).
Now I'm doing the director's SATR to 5/4/13 and I want to put the salary on it, but when HMRC look at is compared to the PAYE returns it won't match and I know I'll get a letter asking what's happened.
So, should I:
A. File it anyway and await the letter?
B. File it with a note in the 'Any other information' box?
C. Determine that the salary was not actually paid (on the basis that HMRC were not informed) and reverse it in the accounts? That would make the DLA about £2,500 overdrawn at 6/4/13, so not the end of the world.
D. Do something else I've not thought of?
Thanks.
I'm aware I'm probably overthinking this ;-)
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Replies (5)
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If you are saying that it was right that no tax or NI was deducted or paid then I would do A. You may get a letter, but I would put money on you not getting one.
Eh?
A salary at LEL is presumably to get the pension credit. If this isn't reported via PAYE then this won't be effective for the pension credit.
A and D
D being that the company needs to file an amended P35 and include a P14 for the director's salary.
Was the credit to the DCA to cover 8 months to 31/03/12 and 4 months to 31/07/12. What has been the annual charge for Directors salary in the previous 3 years accounts. How does this relate to the last 3 years personal tax returns.
D
Include the salary in the July 2013 accounts as a bonus/salary provision and 'pay' it in the 2013/14 tax year.
'Pay' the provision via PAYE in 2013/14.
Then include it on the 2013/14 SATR.