PAYE tax code delays ‘could cause problems’

13 Aug 2014

The Association of Taxation Technicians (ATT) has expressed concerns over a proposal by HM Revenue & Customs to relax the timeframe in which a PAYE must be revised and issued.

HMRC is currently expected to issue a PAYE code to an employee before or at the same time as they issue it to the employer, according to the 2003 PAYE Regulations. The proposed relaxation could allow for the code to be issued to employees up to 30 days after being issued to employers.

Natalie Miller, President of ATT, said: ‘This will inevitably lead to many payrolls being run using amended coding notices before employees have had the chance to check that they are correct. This seems wholly illogical to us and very likely to lead to payroll bureaus and employers having to deal with more enquiries and complaints from employees and pensioners who cannot understand why there is a change in their net pay’.

An HMRC spokesperson said: For the majority of our customers, PAYE deducts the right tax at the right time, so the significant majority of customers who pay their tax through PAYE will be unaffected by this proposed change.

‘HMRC is proposing not to issue tax codes to customers who have no liability to pay tax or where their tax position remains unaffected’.

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