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HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
, see all updates

Employer records: set up employer record: P scheme - PAYE employees only

An employer record is required with a P scheme type for all organisations and businesses making payments to employees, pensioners and office holders, for example, directors. The employer is only required to operate PAYE where one or more of the following occurs / arises

  • Payments at or above the lower earnings limit are made to directors / employees
  • Payments are made to a director / employee who receives payments from another job or pension
  • Benefits and / or expenses are provided to a director / employee

Or exceptionally

  • When a limited company intend to claim a refund of CIS deductions suffered only

Note: If none of the above occur it is not necessary for the employer / contractor to have a PAYE scheme.

An employer record is also required with a P scheme type for all organisations and businesses providing benefits and expenses which are liable to Class 1A NICs.