Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
Updated
, see all updates

Debt and return pursuit: PAYE RTI: submissions and charges: specified charges

RTI specified charges on ETMP

A specified charge is created by ETMP when an employer fails to submit RTI returns, and consists of an estimated amount of tax, NIC and Student Loan deductions due for the month. These charges are raised under the provisions of Regulation 75A The Income Tax (Pay As You Earn) (Amendment) Regulations 2012.

Charge creation

ETMP reviews the employer’s record on the 22nd of the month. If an FPS or nil pay period EPS has not been submitted, ETMP will automatically calculate a specified amount. The specified amount is calculated by dividing the year-to-date tax, NIC and Student Loan deductions figures, reported by the employer on the previous month’s RTI submissions, by the number of months covered by these returns. ETMP creates a specified charge for this sum.

A specified charge can only be replaced when the employer submits the outstanding FPS or quantification takes place. When the outstanding return is submitted or the quantified amount entered on ETMP, the specified charge is ‘reversed’ and a new FPS charge created.

Where specified charges are raised for more than one consecutive month and the employer then makes FPS submissions for the latest month, only the latest specified charge is reversed and an FPS charge is created for that month.

A specified charge will be reversed where an EPS, advising that no payments were made to employees during the period covered by the specified charge, is received after the 22nd of the month. However, no reversal will take place if an FPS has been processed for subsequent months in the same tax year, as the specified amount forms part of the year-to-date figure.

IDMS in-year RTI specified work items

When an in-year RTI specified charge on ETMP becomes overdue, IDMS creates an In Year RTI Specified work item.

The work item shows the specified 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 Specified work item is made up of a reference number and ASN like “123 P 1234567 YYYYSP MM” where:

  • 123 P1234567 is the Accounts Office reference
  • YYYY is the tax year
  • SP represents specified
  • MM is the monthly instalment and ranges from 01-12.

Specified charges for non-RTI employers

For those employers exempted from RTI (for example, NORPRO, TAS and XP schemes - see DMBM519025), if the employer makes a payment by the due date, ETMP will raise a charge to match the payment amount.

If a payment is not made by the due date, ETMP will raise a specified charge and when the employer does pay, ETMP will reverse out the specified charge and create a charge to match the payment.

IDMS non-RTI-specified work items

Before April 2014, IDMS RTI-specified and non-RTI-specified charges both showed on IDMS as RTI specified charges, and had the same work item type.

Since April 2014, non-RTI-specified charges are sent to IDMS with their own work item type. The work item shows the non-RTI-specified amounts in the Tax, NIC and SLD fields where appropriate. You can see these details on the View Work Item screen.

The reference for a non-RTI-specified charge work item is made up of a reference number and ASN like “123 P 1234567 YYYYNS MM” where:

  • 123 P 1234567 is the reference
  • YYYY is the tax year
  • NS represents non-RTI-specified
  • MM is the monthly instalment and ranges from 01-12.

Enforcing specified charges

The specified charges calculated by ETMP and sent to IDMS are legally enforceable under Regulation 75A of the Income Tax (Pay As You Earn) (Amendment) Regulations 2012.

ETMP has no concept of an estimated debt, so RTI work items do not follow an establish debt process.

Campaigns can pursue these debts by issuing an IDMS99 to the employer instead of a P101. The seven-day principle still applies and the charge becomes enforceable after that time.

Specified charges should not be reversed for period employer still trading

Where an employer elects to pay quarterly due to being below the £1,500 PAYE monthly limit, they are still legally obliged to submit their RTI return information each time, or before, they pay their employees. This means that for both monthly and quarterly payers, HMRC still expects either an FPS or EPS each month.

A specified return charge should remain on record until either the:

  • FPS or nil EPS is received for that tax month and replaces the specified charge with the actual amount due
  • specified charge has been cancelled as it was created in error; for example, the scheme is a cancellation or cessation.

Where an employer elects to pay quarterly, specified charges should not be reversed as there is a monthly filing expectation and these are correctly due, with any amounts payable at the appropriate quarter.