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HMRC internal manual

PAYE Manual

From
HM Revenue & Customs
Updated
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Employer returns: employer return post capture: errors / omissions from employer returns (Action Guide)

To correct an employer record following notification of an error or omission, follow steps 1 - 18 below. The Guide is presented as follows

Steps 1 - 4

Step 5

Steps 6 - 9

Steps 10 - 11

Steps 12 - 17

Step 18

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

Initial action

  1. If the error or omission relates to a late claim for reimbursement of SSP, SMP, SPP, SAP, NIC compensation on SMP, SPP, SAP go to step 5

Otherwise

  1. Retrieve the employer related electronic file ‘Employers making mistakes on EOY Returns’

  2. If an entry has already been made concerning this error / mistake go to step 5

Otherwise

  1. Make an entry on the next available line and add any forward note that you consider may be useful when reviewing the employer related electronic file

Choosing your next action

  1. Your action depends on the kind of errors or omissions the employer has made. If the error or omission is
  • On form(s) P14, (or a form P14 is missing) but all amounts on form P35 are correct go to step 6
  • On form P35 but all amounts on form(s) P14 are correct go to step 10
  • On form(s) P14, (or a form P14 is missing) and P35 is also incorrect go to step 12
  • A late claim for reimbursement of SSP, SMP, SPP, SAP, NIC compensation on SMP, SPP, SAP go to step 18

Note: A late claim for CIS Deductions suffered can only be accepted in writing and can be dealt with as an error on form P35, go to step 10.

Error on P14 (or P14 missing) but P35 correct

Your action depends on whether the incorrect figure involves tax, NIC or pay

  • If the wrong amount of tax is shown go to step 6
  • If the wrong amount of NIC is shown go to step 7
  • If both tax and NIC are incorrect go to step 8
  1. If the wrong amount of tax is shown
  • Prepare a pro forma form P14. Follow the guidance in
    • ‘Captured returns - exceptions - up to 2004 (Action Guide)’ at PAYE46011 for tax years up to 2004
    • ‘Recording receipt of employer return (Action Guide)’ at PAYE41041 for tax years 2005 onwards
  • Advise the PAYE section of the correct figures
  • Attach a copy of the memo to form P35
  1. If the wrong amount of NIC is shown on form P14
  • Prepare a pro forma form P14. Follow the guidance in
    • ‘Captured returns - exceptions - up to 2004 (Action Guide)’ at PAYE46011 for tax years up to 2004
    • ‘Recording receipt of employer return (Action Guide)’ at PAYE41041 for tax years 2005 onwards
  • Use Function AMEND EMPLOYER NOTES to record your actions and then file the pro forma P14 in the annual run of P14 returns
  • When you receive a RSSN / DRF discrepancy notification from NICO forward the correct P14 details to them
    • Attach a copy of all correspondence to the return
  1. If both tax and NIC on form P14 are incorrect but the figures on form P35 are correct
  • Advise the PAYE section of the correct figures
  • Prepare a pro forma form P14 to show the correct figures of pay and tax. Follow the guidance in
    • ‘Captured returns - exceptions - up to 2004 (Action Guide)’ at PAYE46011 for tax years up to 2004
    • ‘Recording receipt of employer return (Action Guide)’ at PAYE41041 for tax years 2005 onwards
  • Use Function AMEND EMPLOYER NOTES to record your actions and then file the pro forma P14 in the annual run of P14 returns
  • When you receive a RSSN / DRF discrepancy notification from NICO forward the correct P14 details to them
  • Attach a copy of all correspondence to the return
  1. If the pay on form P14 is incorrect but the tax and NIC figures on form P35 are correct
  • Contact the employer immediately by telephone
  • Confirm that the figures for pay on form P14 are incorrect
  • If the return and form(s) P14 were completed incorrectly and the figures returned for pay do not reflect the amounts paid to the employee
    • The employer must forward an additional Employer Annual Return
    • This must include an additional P14 return to record the difference between what was originally filed and what the figure should be

For example, if the employer recorded £1000 000 instead of £10 000, the amended pay figure should now be ‘-£990 000’

  • The employer must also send a new nil P35 return to record that there are no changes to the figures reported on the original P35
  • BF the papers for a response, update EBS notes

Error on P35 but P14 correct

  1. Prepare a pro forma P35. Follow the guidance in
  • ‘Captured returns - exceptions - up to 2004 (Action Guide)’ at PAYE46011 for tax years up to 2004
  • ‘Recording receipt of employer return (Action Guide)’ at PAYE41041 for tax years 2005 onwards
  • Make any adjustment in green ink, with any necessary notes of explanation
  • You should make any negative adjustment in red ink
  1. Use Function CAPTURE EOY RETURN DETAILS to process the return as a correction P35

Error on P14 (or P14 missing) and P35 incorrect

  1. Contact the employer immediately by telephone to
  • Request confirmation that the figures entered on the return and form(s) P14 reflect the amounts calculated in the year of deduction, and
  • That they have not already made the repayment to their employee(s)
    • If they have already made the repayment go to step 14, otherwise
    • Go to step 15
  1. If you are unable to contact the employer / obtain the information refer the case to the Debt Management Office with a report of the action taken asking them to pursue the missing or incorrect information
  • Use Function AMEND EMPLOYER INDICATORS to set the INSTIND(1) indicator
  • BF your papers for a reply
  1. If the return and form(s) P14 were completed incorrectly and the figures returned for either tax or National Insurance did not reflect the amounts deducted
  • The employer must forward an additional return

Otherwise, if the figures returned correspond with the amounts deducted

  1. If the tax shown on the return and form(s) P14 was deducted from the employee(s) incorrectly
  • The employee(s) must contact the office that deals with their own affairs to claim a repayment by
    • PAYE, or, if they complete a return
    • Self Assessment
  1. If the National Insurance Contributions shown on the return and form(s) P14 were deducted from the employee(s) incorrectly go to step 17

  2. Submit the papers to NICO at the following address. NICO will refund the overpayment directly

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Late claim for reimbursement of SAP / SSP / SMP / SPP (for years up to 2010-11) / OSPP and ASPP (for years from 2011-12)

  1. This should be made on form SP32 and returned to the HMRC local Office for NI Operations to authorise the payment and forward to NICO Refunds Group at the above address