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HMRC internal manual

PAYE Manual

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HM Revenue & Customs
Updated
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Employer records: modified PAYE schemes: expatriate employees - EP Appendix 6 arrangements from April 2006 (Action Guide)

Employers who operated Modified PAYE for their tax equalised employees under an existing EP Appendix 6 agreement, prior to April 2006 could continue to use this arrangement for 2006-07. However they had to re-apply under the updated arrangements before 6 April 2007 because any modified arrangement in existence under the old procedures ceased at 5 April 2007.

To deal with a request for authority to operate modified PAYE follow steps 1 - 6 below

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

Employer / agent request authority to operate modified PAYE

  When an employer / agent requests authority to operate modified PAYE
   
1. Advise the employer / agent to submit an application signed by the employer to operate modified PAYE under EP Appendix 6 to Personal Tax International in Manchester

Application to operate modified PAYE under EP Appendix 6 received

  If you receive an application to operate modified PAYE under EP Appendix 6
   
2. Forward the application to Personal Tax International who will take the following action
3. Use ECS to check that the Class 1A indicator is set for the current year
  * If not, use ECS to set the Class 1A indicator
  * Use Function AMEND EMPLOYER NOTES to record your actions and then file the papers in the employer record pad
  * Use EBS Function EMPLOYER NOTES to enter ‘EP Appendix 6 Modified PAYE in operation for Expatriate Employees from [enter date]’
  * Arrange for the creation of the separate scheme
  * Advise the PAYE Employer Office to make an entry in the employer-related electronic file ‘P11D(b) - Modified PAYE Schemes’ that an application for the new EP Appendix 6 scheme has been approved
  * Request transfer of the employee(s) record(s)

Action at April each year

4. Review the list of employers in employer-related electronic file ‘P11D(b) - Modified PAYE schemes’. In each case check
   
  * Whether a P11D(b) has been received for year CY-1
  * If it has been received in time then go to step 6
  Or
  * If it has not been received request the P11D(b) then go to step 5
5. Forward the following details to the penalty officer to consider raising any penalties
  * Employer name
  * Employer PAYE reference
  * The year the P11D(b) was not received or the date received late
6. Use Function VIEW BROCS Format 2 to check
  * Whether a Class 1A payment was received by 19 July
  * If payment was received by 19 July then no further action is necessary
  Or
  * If payment was not received or was received after 19 July and there is no linked EP Appendix 7A arrangement, contact the Debt Management Office and advise them that interest will be due on all payments made after the previous 19 April
  Or
  * If there is a linked EP Appendix 7A Arrangement, notify the Personal Tax International who will check the NIC Settlement Return and advise the appropriate action to be taken