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How do I deal with late employment allowance claim

New client hasn't claimed employment allowance this year although it was available

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Just taken over new payroll client and he was sole director and employee of his firm at start of this tax year but then took on an employee & has been paying employers NI. I have claimed the employment allowance & submitted EPS. Client is due to pay HMRC next week for November wages - am I right in thinking he can knock off the employers NI on that payment?  Plus, can he reduce his overall payment to take into account the earlier employer's NI  or should I phone the employers helpline to get this agreed?.  His overall bill for the tax year for employers NI is going to be under £3,000.

 

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By NYB
10th Dec 2018 13:56

Your software should cater for all this. and the NIC allowance should be reflected in the P30. Same with claiming the back months. Each software handles it differently. Your dont need to "get this agreed".

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By TessaW
to NYB
10th Dec 2018 14:24

Thanks for this. I had a look on the payroll (which is Moneysoft) and it shows that the client should have paid less employers ni earlier on. So I take it that when HMRC process the EPS for the employment allowance, my client's PAYE & NI account with HMRC will show an overpayment for the earlier months when the allowance had not been claimed.

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10th Dec 2018 15:30

At the end of the year you can claim any overpayment if there is remaining allowance.

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By SXGuy
11th Dec 2018 07:58

Employment allowance starts the moment you claim. It doesn't credit with overpayments from previous periods, you need to run it to year end then claim the overpayment back from hmrc.

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By TessaW
to SXGuy
11th Dec 2018 09:53

Thanks - this clarifies things. My new client uses Xero payroll & this shows the employment allowance only being deducted on future payments. I use Moneysoft on other clients & it looks as though Moneysoft goes backwards & puts the allowance back against past deductions. Xero appears to be what HMRC say should be done.

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