I've a problem with Basic PAYE tools as was expecting NICs and Tax to be calculated for a Director from february 2016 until end of March 2016. That is not happening as I drafted the payment for 31 March today, and still zeroes on NICs and Tax.
Due to lack of work, the Director left the company payroll on 30/09/2015, but then an unexpected job came and he resumed payroll from 12th October 2015. Because of that, he was processed in September 2015 as a Leaver, all FPS submitted, P45 issued when he left.
Please apologise for the length of this, but it might be good to include all the available data on Basic PAYE.
Data of the Director as LEAVER from April 2015 to September 2015:
Tax Code: 1060L
Is this Week 1/month 1 basis: No
Pay frequency: Monthly
Paid on an irregular basis: No
National Insurance category letter: A
Normal weekly hours worked: 30 or more
Start Date: 11/08/2014
Type of starter: New starter without form P45
Is this employee a director: Yes
Date appointed as director: xx/08/2014
National Insurance calculation method for this director: Directors Cumulative Method
With the above settings, this director received 6 Payments of 883.00 each, from 30 April 2015 to 30 September 2015, totalling £5298.00.
Data of the Director from October 2015:
Tax Code: 1060L
Is this Week 1/month 1 basis: No
Pay frequency: Monthly
Paid on an irregular basis: No
National Insurance category letter: A
Normal weekly hours worked: 30 or more
Start Date: 12/10/2015
Type of starter: New starter with form P45
Tax code at date of leaving: 1060L
Date previous employment ended: 30/09/2015
Was this Week 1/month 1 basis: No
Previous pay frequency: Monthly
Last pay period number: 6
Total pay to date in previous employment: £5298.00
Total tax to date in previous employment: £0.00
Is this employee a director: Yes
Date appointed as director: xx/08/2014
National Insurance calculation method for this director: Directors Cumulative Method
With the above settings, the Director received one payment of £560.00 in October plus five payments of £883.00 each until end of March 2016 totalling £4975.00 (the March FPS is not submitted however because it was a test)
By any chance could anyone help? I am puzzled as was expecting Basic PAYE tools to consider the full annual income and then apply the NICs and Tax calculations at least on the last payment of the year.
Thank you
Replies (10)
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Looks
right tax-wise.
NIC: Though you should be able to claim employment allowance under 2014/2015 rules thereby negating ers nic.
Due to incorrectjy entering leaving date.
Is this the only employee?
As you are showing 2 periods the system is not averaging all income, only that since new start date which is less than a time apportioned annual earnings period.
Talk to online services, roll back to before the creation of P45, and then re-enter later payments without leaving details.
Hi John
Sorry for delay in seeing your response.
I suggested talking to online services first as I am concerned the P45 may stop the roll back working, plus I wasn't sure if you would know how to roll back.
Without the leaving details merely meant don't say he left again, as he actually never did.
Your expectation should be that Tools takes all the earnings for the year against a full years earnings period resulting in Class 1 liability - payable by Director and covered by allowance for employer
Hi there
HMRC have already had FPS submissions so you don't want to send them again.
Now you know removing the leaver details worked, replicate up to an un-submitted month, and then when you choose the option for that month change your choice. It will let you resubmit the amendments before entering the first new one, which should over-write the existing entries. .
Then when you add the next month it should just carry on as usual but this time get the right answer?
No problem
Send them all - they will just over-write the existing fps so that March will have the right cumulative and the March quarter will show the correct amount payable