HMRC issues a last-minute reminder about the actual payment of the tax
HMRC has reminded banks etc how to pay the bank payroll tax - which needs to be done by Tuesday 31 August to avoid interest and penalties.
The tax
The bank payroll tax (BPT) was announced at the time of the 2009 Pre-Budget Report with the enabling legislation in Finance Act 2010. BPT is payable on or before 31 August 2010 otherwise interest and penalties will become payable as well.
The BPT is payable by banks and building societies operating in the UK on awards of bonuses over £25,000 to (or in respect of) certain employees in the period from 9 December 2009 to 5 April 2010. The BPT is 50% of the excess over the £25,000 and is not deductible for corporation or income tax.
When BPT was announced it was anticipated that it would raise £0.5bn because it was hoped it would discourage banks from actually paying the bonuses. That didn’t happen and in the Red Book accompanying the Emergency Budget of 22 June 2010 it is estimated that BPT will raise £2.5bn.
Payment of the tax
BPT must be paid by CHAPS and banks need to ensure that the sort code, account number and beneficiary name are entered in the appropriate fields and that erroneous zeros are not entered.
CHAPS closes at 3pm.
Payment by CHAPS should be to HMRC, Accounts Office Cumbernauld (irrespective of the Accounts Office to which the taxable company normally makes payments):
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Account name
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HMRC Cumbernauld Receipts
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Sort Code
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08 32 10
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Account Number
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12001039
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Payment should be made under the taxable company's Corporation Tax Unique Taxpayer Reference (UTR) prefixed with 'XXBPT', eg: XXBPT1234567890. It is essential that payment (and returns) are submitted using this 15-digit format otherwise payments will not be identifiable and be reconciled to returns.
If paying electronically from a bank account outside the UK the following IBAN and SWIFT identifier/BIC must be used:
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IBAN
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GB74CITI08321012001039
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SWIFT Identifier/BIC
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CITIGB2L
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