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HMRC internal manual

Debt Management and Banking Manual

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HM Revenue & Customs
Updated
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Debt and return pursuit: PAYE RTI: cessations: overview

RTI employers can advise HMRC that they have ceased employing staff by completing the ‘Cessation’ date on an FPS/EPS. When RTI core advises ETMP that a cessation date has been received, the ‘Potential Cessation’ date is populated on ETMP. RTI core also notifies EBS and if the validation is passed, then EBS is updated which then updates ETMP with the cessation date replacing the potential cessation date.

Alternatively, if you are advised of a cessation during contact with the employer, you can manually enter the Potential Cessation date on ETMP.

Potential cessation date

When the potential cessation date is populated, a Potential Cessation work item is created on ETMP. PT Operations reviews the case and decides if ceasing the scheme is appropriate. It is not necessary to contact PT Operations for these cases.

Setting the Potential Cessation date on ETMP:

  • removes tax obligations from the potential cessation date onwards
  • reverses all specified charges belonging to the periods after the potential cessation date
  • updates any IDMS work items.

If the Potential Cessation date is amended or removed (other than by replacement with actual Cessation date) ETMP:

  • recreates the tax obligations from the potential cessation date onwards
  • updates any IDMS work items.

Cessation date

When PT Operations decide to cease the scheme, they enter the cessation date on EBS. EBS will then send the actual cessation date to ETMP to update the employer’s record and the Potential Cessation work item will clear.

When the cessation date is set, ETMP:

  • removes tax obligations from the cessation date onwards
  • removes the potential cessation date
  • reverses all specified charges relating to the months after the cessation date
  • updates any IDMS work items.

If an FPS has already been submitted by the employer for a month after the cessation date, a worklist item is generated for PT Operations to review.

If the cessation date is cancelled, ETMP:

  • recreates tax obligations from the original cessation date
  • updates any IDMS work items.

Risk & Intelligence Service (RIS)

From 6 April 2013, IDMS will record the ‘Permanent Cessation Indicator’. Under certain circumstances, RIS may decide that an employer record needs to be closed permanently. This indicator alerts you to the fact that the record has been permanently closed. However, you should never advise the employer that HMRC have ceased their employer record permanently.