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HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
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Employer records: modified PAYE schemes: employees seconded abroad - arrangements up to 5 April 2006 (Action Guide)

To deal with a request to defer the reporting and payment of secondary NIC due on payments made by overseas companies, follow steps 1 - 4 below.

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

Employer contacts you to advise that they have employees seconded abroad

  1. If the employer contacts you to advise that they have employees seconded abroad follow PAYE28013

Employer forwards form P350 for Modified NICs

  1. Advise the employer that applying for a modified PAYE scheme using form P350 is inappropriate, and they must either
  • Operate PAYE in the normal way, or
  • Submit an application to operate Modified NICs under Employment Procedures Appendix 7B

The employer-related electronic file ‘Employer with employees seconded abroad - earnings paid by overseas companies’ must be reviewed in April each year. April 2007 will be the last year that arrangements made under this agreement are reviewed

For each entry where there was an arrangement to defer NIC payments for CY-1 you must

  1. Use Function VIEW EOY RETURNS HISTORY to check whether a return has been received for CY-1. Your next action will depend on whether a return has been recorded as received and on what date
  • If a return has been received and the date it was recorded as received is 31/01/CY or earlier
    • Use Function VIEW BROCS, formats 2 and 3, to establish if the NIC liability has been paid and that all payments were made by 31/01/CY~
    • If there are any outstanding liabilities or any payments were made after 31/01/CY, contact the Debt Management Office and advise them that interest will be due on all payments made after that date, or
  • If the return has been received and the date it was recorded as received is after 31/01/CY and the return has already been captured
    • Refer the case to the ECS penalty officer and request them to unset the Temporary Inhibition’ indicator on ECS for CY-1
    • Ensure a penalty is issued for the late submission of the return
    • Contact the Debt Management Office and advise them that interest will be due on any payments made after 31/01/CY, or
  • If the return has not been captured
    • Use Function CAPTURE EOY RETURN DETAILS to process the return and set the ‘NFP’ indicator in the P228 Remarks field
    • Refer the case to the ECS penalty officer and request them to unset the ‘Temporary Inhibition’ indicator on ECS for CY-1
    • Ensure a penalty is issued for the late submission of the return
    • Contact the Debt Management Office and advise them that interest will be due on any payments made after 31/01/CY, or
  • If the return has not been received
    • Refer the case to the ECS penalty officer and request them to unset the ‘Temporary Inhibition’ indicator on ECS for CY-1
    • Ensure an interim penalty notice is issued
    • Contact the Debt Management Office and advise them that interest will be due on any payments made after 31/01/CY
  1. Use Function AMEND EMPLOYER SCHEME HISTORY to enter a Cessation Date of 5 April 2006