More updates from HMRC for employers and tax agents
HMRC has issued a reminder for employers about submitting forms P46 online and a new version of its booklet P49 ‘Paying someone for the first time’.
Form P46
Form P46 is used when an employer takes on a new employee who does not have a form P45 (giving details of a previous employment). The employer and employee together complete form P46 which the employer sends to HMRC so that the new joiner can be correctly treated under PAYE.
For employers submitting the P46 online, HMRC has provided reminders:
- about the need to keep records where the new joiner does not complete an actual hard copy P46
- that if the employee has ticked box A or box B the employer should send the P46 to HMRC when his or her earnings reach the NIC lower earnings limit, rather than when they reach the tax threshold as in previous versions of the form
- that P46s and related information must be kept for the current plus three closed years.
HMRC’s message in full is as follows:
Employers submitting forms P46 online
“We have received quite a few requests from employers about the process they need to apply when submitting online forms P46, including some record-keeping issues.
“From April 2008 we have allowed employers submitting forms P46 online to obtain the P46 information from new employees without the need for the employee to complete an actual hard copy form. This is acceptable as long as the employee has been asked all the questions on the form, and a suitable audit trail is held by the employer showing that the information was provided by the employee. We are aware that some employers obtain this information electronically from their employees and we would therefore remind employers that, should you have … such a facility in your software products, the instructions to employers on page two of form P46 now refer to earnings reaching the NIC lower earnings limit, rather than earnings reaching the tax threshold. You must ensure that this change is reflected in any product you [use] to ensure the employer follows the correct procedure.
“Our published employer guidance tells you that you must keep records for the current plus three closed years and this will apply to P46s or any information that an employer has obtained and used in order to complete one.”
Booklet P49
HMRC has moved from routinely issuing printed P49s as part of the New Employer Pack. This booklet P49 Paying someone for the first time is now available online in an enhanced bookmarked format which should be easier to navigate around.