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HMRC internal manual

PAYE Manual

Employer records: maintain employer record: reimbursements and advances

When does a reimbursement or advance arise?

An employer may claim a reimbursement or an advance where the total refunds he or she hashad to make for an Income Tax month or year are more than the deductions he or she hasmade.


Reimbursements and advances are the responsibility of Banking Operations and if youreceive any applications or enquiries then these should be referred to Banking Operations immediately.

Any claims made by the employer must be

  • In writing




  • Explain how the amount claimed has been worked out


The employer will be eligible to make a claim for reimbursement if at the end of anyIncome Tax month the total PAYE refunds to employees exceed the deductions.

The reimbursement can be claimed from Banking Operations for the appropriate amount oralternatively it can be claimed from the amount of tax to be paid over to BankingOperations for the next month.


An employer will make a claim for an advance if they have insufficient tax or NIC in handto make a refund(s) to its employees.

Claims received in your office

You may receive a claim

  • Direct from the employer




  • From another section within your office

You may also receive a memo from Banking Operations. This will happen if a claim isreceived there after receipt of the form P35 for the year has been received but beforeP228 details for that year have been recorded.

You must treat any claims you receive as priority and take the appropriate actionon the day of receipt.