Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
, see all updates

Employer returns: capture employer return - 2005 onwards: capturing return - 2005 onwards (Action Guide)

Notes:

  1. This Action Guide should be used for tax years from 2004-05 only.

  2. References to CIS in this Action Guide applies to the old CIS scheme for years up to April 2007, when ‘New CIS’ was introduced.

When you are required to capture an annual return, follow steps 1 - 36 below. This Guide is presented as follows

Steps 1 - 4

Steps 5 - 9

Steps 10 - 12

Steps 13 - 16

Steps 17 - 19

Steps 20 - 21

Step 22

Steps 23 - 25

Step 26

Step 27

Step 28

Steps 29 - 36

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

Initial action

  1. When capturing a return for tax year 2004-05 onwards review the return and decide which of the following return classes apply

Is the return class

  • An Original Complete
  • An Original Part P35
  • An Additional Complete
  • An Additional Part P35, or
  • A Correction
  • Additionally you will need to determine if the return is a pro-forma

Note: For years up to 2007, when capturing a CIS36 return for a PSC or XP scheme type employer, you can only choose Original Complete, Additional Complete or Correction return classes.

  1. Use Function CAPTURE EOY RETURN DETAILS to capture the information provided on the return

  2. Where a pro-forma return is captured this must be noted by checking the Pro-forma checkbox

  3. Where the return is captured successfully go to step 29

Otherwise

  • If the employer / contractor reference cannot be found go to step 5
  • If the year on the employer record to which the return relates is not live go to step 10
  • If the employer record has moved go to step 13
  • If the year is already cleared cancelled one year only (COYO) or dormant go to step 17
  • If the receipt of the return has not been recorded go to step 20
  • If the classification of the return being captured is not accepted go to step 22
  • If a figure of Student Loan Deductions appears on the return but the scheme is not noted as a Student Loan employer go to step 26
  • If there is an error message ‘Maximum number of receipts already recorded’ go to step 27
  • If there is an error message ‘Submission type selected is not consistent with the entry on EOY return details’ go to step 28
  • If a negative amount is entered in the ‘Total NICs’ box (box 3 on P35) contact the Employer Business Service (EBS) Helpdesk (This content has been withheld because of exemptions in the Freedom of Information Act 2000) for further guidance

Employer / contractor reference not found

  1. If the employer reference shown on the return cannot be found on the Employer Business Service (EBS)
  • Use NPS Function Quick Search or Trace and Match (Employer) to search for a valid employer reference
  • If a valid employer reference is found go to step 6
  • If valid employer reference is not found go to step 7
  1. If a valid reference is found
  • Using green ink strike through the invalid employer reference on the return and enter the correct details
  • Use Function RECORD RETURN RECEIPT to record the date the return was received if it has not already been recorded as received at the correct employer reference
  1. If the return is not proper to your office
  • Date stamp the front, and
  • Forward it to the correct office
  1. If the return is proper to your office use Function CAPTURE EOY RETURN DETAILS to capture the return
  • Go to step 29
  1. If you cannot find a valid reference check if the employer’s address is in the area for which your office is responsible
  • If the employer’s address is in your area use Function EMPLOYER SET UP to create a new record, see section ‘Set up employer record’ at PAYE20000 onwards

And then in all cases on the next working day, when the record has been updated

  • Use Function RECORD RETURN RECEIPT to record the date the return was received
  • Use Function CAPTURE EOY RETURN DETAILS to capture the return details
  • Go to step 29
  • If the employer’s address is not in your area
    • Date stamp the front of the return with the date of receipt
    • Send the return to the correct processing office asking them to set up a new record immediately

EBS shows year not live

  1. If you have been unable to capture the return because the year on the EBS employer record is not live
  • Review the tax year on the return and check that the correct year was entered when capturing
    • If the correct year was not entered, use Function CAPTURE EOY RETURN DETAILS again entering the correct year
    • Go to step 29

Otherwise

  1. If the correct year was entered review the information held and satisfy yourself that a live employer record is required for the year on the return
  • If it is required use Function AMEND EMPLOYER SCHEME HISTORY to update the employer record. To
    • Reopen a cancelled employer record - see ‘Re-opening an employer record’ at PAYE21205
    • Change a start date - see ‘Maintain scheme start date’ at PAYE27020
    • Restart a ceased employer record - see ‘Re-starting an employer record’ at PAYE21215
  1. On the next working day, when the record has been updated
  • If the receipt of the return has not been recorded at the correct reference - use Function RECORD RETURN RECEIPT to record the date the return was received, and then
  • Use Function CAPTURE EOY RETURN DETAILS to capture the return details
  • Go to step 29

Employer record has moved

  1. If you have been unable to capture a return because the employer record has been transferred, merged out or succeeded
  • Use NPS Function Quick Search or Trace and Match (Employer) to search for a valid employer reference and office number
  • Use green ink to note the new employer reference
  1. If the new employer reference is in your office use Function VIEW EOY RETURNS HISTORY to identify whether receipt of the return has been recorded

  2. If the receipt of the return has not been recorded at the correct reference use Function RECORD RETURN RECEIPT to record the date the return was received

  • Use Function CAPTURE EOY RETURN DETAILS to process the return details, and then
  • Go to step 29
  1. If the new employer reference is not in your office, send the return to the new office immediately for capture

Year already cleared COYO or DORMANT

  1. If you are unable to capture a return because the year is already cleared COYO or DORMANT

For COYO cases

  • Use Function AMEND EMPLOYER INDICATORS to remove the COYO indicator

For Dormant cases

  • Use Function AMEND EMPLOYER SCHEME HISTORY to remove the DORMANT indicator
  • Use Function VIEW EOY RETURNS HISTORY to identify whether receipt of the return has been recorded
    • If receipt of the return has been recorded go to step 19
    • If receipt of the return has not been recorded use Function AMEND EMPLOYER INDICATORS to set the year related indicator NOP35REM, and
  1. On the next working day, when the record has been updated
  • Use Function RECORD RETURN RECEIPT to record the date the return was received, and
  • Use Function AMEND EMPLOYER INDICATORS to remove the year related indicator NOP35REM
  1. Use Function CAPTURE EOY RETURN DETAILS to capture the return details
  • Go to step 29

Return not recorded as received

  1. If you are unable to capture the return because it has not been recorded as received
  • Use Function RECORD RETURN RECEIPT to record the date on which the return was received, and then
  1. If the return is not proper to your office
  • Date stamp the front of the return
    • Forward it to the correct office immediately

Otherwise

  • Use Function CAPTURE EOY RETURN DETAILS to capture the return details
  • Go to step 29

Return class not accepted

  1. If you have been unable to capture the return because
  • An Original Complete, or an Original Part P35 return is already captured for this year
    • If you are trying to capture an original return, where an original has already been captured, use Function VIEW EOY RETURNS HISTORY and your papers to identify the correct return class
    • If an original return has already been correctly captured, use Function CAPTURE EOY RETURN DETAILS to capture the next return as an additional return
    • If an original return is already held on the record, but it has been captured against the wrong reference and / or year, you should capture a correction return to reduce the original return to nil, for the wrong reference and / or year
    • Use Function CAPTURE EOY RETURN DETAILS to capture the wrongly captured return for the correct reference and / or year
    • On the next working day, when the record has been updated, capture the return you were originally unable to capture as an additional return against the correct reference and / or year
    • Use Function EMPLOYER NOTES to make a record of the actions taken
  • The return has been classed as an Additional Complete, or an Additional Part P35 and there is no Original Complete, or an Original Part P35 captured
    • Use Function VIEW EOY RETURNS HISTORY and your papers to locate the original return
    • If the return has been recorded as received but cannot be located, contact the employer to ask if they would send in a duplicate of the missing return
    • Reassure the employer, if necessary, that the original receipt date is held on record and the copy of the return will not be treated as a late return
    • On receipt of the copy return, use Function CAPTURE EOY RETURN DETAILS to capture the original return before the additional return
    • Go to step 29

Unable to capture CIS Deduction

  1. Whilst processing the return you may find that the ‘CIS Dedns Suffered’ field is not available. When this happens you must
  • Check the entries on the return
    • If the employer has entered an amount in the CIS deductions suffered box go to step 24, otherwise
  • If there is not an entry in the CIS deductions suffered box you have keyed a figure in error
  1. Use Function VIEW EMPLOYER TRADE & SCHEME DETAILS to check the scheme type
  • If the scheme type is PSC or P go to step 26
  • If the EBS record is another scheme type go to step 25
  1. Contact the employer to confirm the correct scheme type
  • If the employer confirms that the return is incorrect agree a correction to the return
    • Go to step 26
  • If the employer confirms that the return is correct use Function AMEND EMPLOYER TRADE & SCHEME DETAILS to update the employer record
    • Do not continue with capture until the scheme type has been updated on BROCS
    • Go to step 29

Non student loan employer

  1. If you are presented with an advisory message stating the employer is not noted as a Student Loan employer you must
  • Continue to capture the return in the usual way, and
  • Make a prominent note in green ink ‘Not noted as student loan employer’, and then
  • Go to step 29

Maximum number of receipts already captured

  1. Where more than 99 returns have been recorded as received the latest 99 will be displayed. You must
  • Not proceed with the capture of the return or return part
  • Capture one or more of the other 99 displayed, this will remove them from the list, until the return you want to capture is displayed
  • Continue with capture of the return or return part

The submission type selected is not consistent

When a return is being captured to a Return Class and the return or return part recorded as received is not the same return class the error message ‘The submission type selected is not consistent with the entry on EOY return Details’ will be displayed

  1. Where the error message is displayed you must
  • Not proceed with the capture of the return or return part. Either
    • Correct the entry on the Capture EOY Return Details screen, or
    • Correct the selection in the Select Receipt Date list box, and then
  • Continue with capture of the return or return part

Immediate action after capture

  1. Your immediate action after capturing the return depends on the type of return processed. If you have processed form
  • P35 (Offshore Protocol) go to step 30
  • P35 (EP) go to step 31
  • CIS36 go to step 32
  • P35(TAS) go to step 33
  1. When form P35(Offshore Protocol) has been successfully captured you must take the following actions
  • Check the correct amount of tax has been deducted
  • Use Function AMEND EMPLOYER NOTES to record your actions and then file the papers in the employer record pad
  1. When the form P35(EP) has been successfully captured you must take the following actions
  • Send forms P527 and P528 to the PAYE section, and then
  • Use Function AMEND EMPLOYER NOTES to record your actions and then file the papers in the employer record pad
  1. When the form CIS36 has been successfully captured you must take the following actions
  • Capture CIS36 return information onto CIS
  1. When the form P35(TAS) has been successfully captured you must take the following actions
  • For basic rate schemes (Section 1 of form P440) go to step 34
  • For untaxed awards to companies and self employed people (Section 4 of form P440) go to step 35
  • For higher rate schemes (Section 3 of form P440) or where the gross value of the award is £1000 or less (Section 2 of form P440) go to step 37
  1. For each entry in the ‘Untaxed awards to companies and self-employed people’ at the foot of the back of form P440
  • Prepare and issue forms 48
  • Note the processing office to which you sent each form 48 against each entry on form P440
  1. When you have sent all forms 48 needed enter at the foot of form P440 ‘Forms 48 issued….’ (date)
  • File forms P35(TAS), P440 and any P440(CS) in the annual run of P35 returns
  1. After you have successfully captured the return you must make certain further checks. Follow ‘Post capture - 2007-08 onwards (Action Guide)’ at PAYE53012

Capturing P35 charge on ETMP

Where you have a P35 return captured on EBS for tax years 2013-14 onwards you will be required to manually capture the charge in ETMP. To do this, follow guidance at PAYE43210.