Debt and return pursuit: PAYE RTI: submissions and charges: Full Payment Submission (FPS)
An RTI employer should submit a Full Payment Submission (FPS) to HMRC every time they make payments to employees (including employees who are not liable to tax and/or NIC). The submission of the employer’s first FPS will set the RTI ‘Joining Date’ on EBS and BROCS.
The employer sends an FPS online to HMRC using commercial software or HMRC’s Basic PAYE Tools (BPT). These are received by RTI Core which processes the data and updates ETMP with the employer charge and EBS with employee deductions.
The FPS contains the name, NI number, Payroll I.D. (Works Number), address, date of birth, tax code and so on of all employees to whom a payment has been made. It also includes year-to-date totals of payments made to individual employees and PAYE, NIC, Student Loan (SLD) deductions.
An FPS should be sent to HMRC on or before paying an employee. If there is more than one payday in a tax month (for example, the employer has both weekly and monthly paid employees) then the employer is required to submit a separate FPS covering each payday.
Section 18 of the Income Tax (Earnings and Pensions) Act 2003 provides that general earnings consisting of money are to be treated as being received at the earliest of the following times.
- Rule 1 - the time when a payment is actually made or on account of earnings
- Rule 2 - the time when a person becomes entitled to payment of or on account of earnings
An FPS is still required even if the employee’s earnings are below the lower earnings limit (LEL); in other words, no deductions made. These FPSs will carry pay-to-date information required to update the employee’s record.
If no qualifying submission is received then ETMP will raise a specified charge. This an estimated charge, based on previous submissions.
An employer with a quarterly scheme should still submit an FPS on or before paying an employee. If they pay their employees monthly, they will submit at least one FPS every month. RTI core will update ETMP, creating monthly charges, and each charge within the quarter will carry the same quarterly payment due date.
Correcting errors and omissions
Employers have 14 days after the end of each tax month to send an FPS to correct any earlier errors or omissions and for those adjustments to be taken into account within the same month. For example, an error in month 1 needs to be corrected by 19 May for the month 1 charge to be amended. If the error is corrected later, it will be included within the charge for that month. So an adjustment received on 20 May will amend the month 2 charge and if it’s received on 20 June, it will amend the month 3 charge.
After end of tax year
Employers have until 19 April following the end of the tax year to submit an FPS or correction FPS. RTI Core will not accept FPS submissions after this date.
Once the time limit has passed, employers must correct any errors or omissions by submitting an Earlier Year Update (EYU); see DMBM519230.
2014-15 and the following
To support employers who start running their payrolls before 6 April, they can start sending their FPS and EPS submissions for the next tax year from 6 March. RTI core will store them until 6 April when they will be processed against the new tax year.
In-year RTI underpayments charge creation on ETMP
On or shortly after the 6th of each month, RTI Core sends the year-to-date totals (6 April to the 5th of the relevant tax month) for PAYE, NIC and Student Loan deductions (SLD) to ETMP. This is known as an in-year RTI charge (FPS).
ETMP then subtracts the previous monthly charges to create the FPS in-year RTI charge for the current month.
IDMS underpayment work items
If an in-year RTI charge (FPS) has not been paid or cleared by other credits (such as an EPS credit) by the due date, IDMS creates an in-year RTI underpayment work item (subject to the de minimis limit; see DMBM519330 on small underpayments and remissions).
The work item shows amounts in the Tax, NIC and SLD fields where appropriate. You can see these details on the View Work Item screen.
The reference for an in-year RTI underpayment work item is made up of a reference number and ASN: for example, “123 P 1234567 YYYYUn MM”, where:
- 123 P1234567 is the Accounts Office PAYE reference
- YYYY is the Tax Year ending
- U represents Underpayment
- n is the sequential number given to any Underpayment and Advance work items created for the tax year; in other words, n = 1 for the first, 2 for the second and so on
- MM is the monthly instalment and ranges from 01-12.
In-year RTI underpayment work items can also arise where there is a positive EPS charge amount. This can occur if the EPS year-to-date amount submitted by the employer is less than the total EPS credits already claimed.