HMRC issues week 53 payments clarification

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HMRC has issued guidance for those filing week 53 payments to employees on payroll.

These extra payments happen because of the one or two extra days in leap years, that are added onto the usual 52 weeks in a normal year.

The payments won’t apply to those who pay employees monthly, but does to those who pay them weekly, fortnightly or four-weekly.

PAYE is deducted differently from week 53 payments, as the Revenue treats it as...

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What does this mean?

"Extra personal allowance is provided to protect the level of income pay in this case, which may result in an underpayment of tax."

So, is it saying that if you are just a PAYE case, you will get away with the underpayment of tax, but if you are in self-assessment and report all your figures on a tax return, you will lose this benefit and have to pay back the underpaid tax?  That does not seem fair and Yes - I know tax isn't fair, but this is a HMRC concession and they should make it equitable.

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HMRC have issued P800 tax calculations ...

... for employees paid week 53 thus reclaiming the tax. I know employees have to pay the extra tax if they are in Self Assessment or have to have a P800 issued for any other reason - but HMRC have issued P800 for employees who are not in SA or do not otherwise need a P800. I am currently dealing with an employer where all staff are on the NMW and paid 2-weekly. Thus their underpayments are now £8105 x 2 / 52 x 20% = £63.40 and they cannot afford it. Anyone else experiencing this?

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