PAYE Settlement Agreement - Employer Taxes
Employer reporting requirements 2016/2017
3 July 2017
A PSA is a contract between an employer and HMRC where the employer agrees to meet the tax (on a grossed up basis) and NIC on behalf of their employees for certain benefits and expenses. Only benefits that are minor, irregular or impractical to operate PAYE on can be included.
The PSA effectively allows employers to provide smaller or general benefits to its employees and not have their employees taxed on the benefit.
Employers are required to sign up (or make any changes) to this contract on or before the 6 July following the end of the tax year to which it relates.
Calculations of the tax and NIC are typically due to HMRC by 31 July, however, this is not a statutory deadline and, in our experience, submissions often take place throughout August. Subsequent payment of the tax and NIC is due by 22 October.
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