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Mar 2015


HMRC explains disputed charges

HMRC says payroll managers must appeal disputed charges as soon as they receive them and has outlined a common reason they may occur.

Addressing delegates at Ceridian’s annual conference last week, Phil Nilson, from HMRC’s customer and stakeholder engagement team, explained that disputed charges may occur due to a misunderstanding by payroll managers.

He said: “We used to reconcile annually and you used to send us money during the year. You didn’t send any information relating to that money until the end of the year when you submitted your P14s and P35. Only at that point could we start reconciling the money with the information.

“Now, thanks to RTI we are doing that on a monthly basis, we are doing it tax month by tax month.

“Using tax month one as an examples from 6th April to 5th May, HMRC looks at all the Full Payment Submissions (FPS) you have sent in month one on either the 6th, 7th or 8th of May, and then starts the reconciliation process to try to determine the charge that is due.

“Once you’ve sent your FPSs, in an ideal world, they will be visible to you from the 12th of the following month on your dashboard. So in the example used that would be from the 12th of May. So, theoretically, you would send in your FPSs and then by the 12th of May you could go online and could see what we think is due from you.

“But, sometimes things come in late and you may need to send information about payments beyond the end of the tax month, but which relate to the earlier tax month.

“This is vital. If an FPS comes in between the 6th and 19th of May you can put it back into tax month one, where it should be, and the charge will be adjusted accordingly. However, if that FPS comes in after the 19th of the following tax month it won’t go into the dashboard for that month, of tax month one in this case, because the 19th is the cut-off date – the date we want the payment in.

“That may affect your view of what you think is due and we think is due.

“By looking at FPSs it gives us the total amount that is due – but to be taken away from that is anything you want to claw back by way of the Employer Payment Summary (EPS), that should be submitted by the 19th of the following month. So, for tax month one, that will be the 19th of May. In terms of looking at your online account, if you sent that EPS before the 12th of May it will be reflected by the 14th – you will see it within two days.

“I hope that helps you get a better understanding of what we do.”

Article taken from www.payrollworld.com

Posted byCaoimhe ByrneinHMRCPayroll Software