Recent tax figures show a gap of over £3 billion for PAYE, and this is being regarded as due to employer errors.
In this blog, the Clayton & Brewill team discuss these tax gap figures and how employers can ensure they don’t end up on the wrong side of HMRC’s statistics.
What is the PAYE gap?
The gap that HMRC has exposed is the difference between the amount actually paid and what it has calculated that it should have collected through PAYE on earnings, other income from employment and the tax due on occupational pensions taxed through PAYE.
How can employers avoid PAYE mistakes?
Employers should ensure they keep good, easily accessible records of their payroll so that they can keep track of their payments and have clear proof if HMRC approach them with any PAYE related queries.
Prompt payment of PAYE and National Insurance contributions, as well as timely filing of RTI returns and P11Ds can also help to minimise the risk of mistakes or accidentally forgetting to file necessary documents. It is also vital to make sure all employee information is accurate and that, if any errors do occur, they are corrected as soon as they are discovered.
Despite these ways to support accurate PAYE reporting, mistakes can and do happen. The most common of these include:
- A business miscalculating someone’s employment status
- A payroll system that hasn’t been updated
- Employee records not showing a change to salary, hours or personal details
While these are easy mistakes to make, they come with the risk of penalties and can soon become expensive for the business.
How we can help
At Clayton & Brewill we understand how complex payroll can be and how important it is to ensure everything related to PAYE is correct. We can help you to check that your PAYE is operating as it should and provide you with any additional support you or your business may need to run smoothly.
Please do not hesitate to get in touch with a member of our team today to find out more.
