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HMRC internal manual

PAYE Manual

HM Revenue & Customs
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Employer records: maintain schemes: change scheme type - PSC to XP (Action Guide)

To take the appropriate action when you are told that a business no longer has employees but still has at least one subcontractor, follow steps 1 - 3 below.

This Guide is presented as follows

  Step 1
  Steps 2 - 3

For details of how to access any of the Employer Business Service functions, use PAYE057.

Initial action

1. Use Function AMEND EMPLOYER TRADE & SCHEME DETAILS to change the scheme type to XP for CY+1
  Enter an RTI PAYE liability effective date, which must be the date the business switched to sub contractors only

Clerical action

2. Write to the employer to advise them
  * That you have updated the employer record with effect from (date)
  * The reason for the change
  * That they will need to submit completed forms P35, forms P14 and any outstanding CIS returns for the previous year (if not already done)
  * That for subsequent years they will only need to forward completed monthly CIS returns
3. Use Function AMEND EMPLOYER NOTES to record your actions and then file the papers in the employer record pad