New starter legislation: The disappearance of the P46
When it comes to having a new starter in your business, it is extremely important that the transition is seamless. Not only for your new employee, but also for yourself and your data inputting.
The quality of the data that you need is extremely important. While this seems obvious, getting it right early will mean that there are less problems later on, freeing your time up for other important jobs.
First of all is getting the new starter data correct. The data that is needed is as follows:
Date of birth
National Insurance Number
Employment Start date
Information needed from the P45 is as follows:
Previous employer PAYE reference
Employee National Insurance Number
Final tax code
Week 1/Month flag
Total pay (previous employer)
Total tax (previous employer)
Previous employer period number
Student loan indicator
Just to note: If the P45 is from the previous tax year, it can be used until the 25th May of the current year.
The disappearance of the P46
The P46 has now been replaced by the “Starter Declaration”. For this, you can use your own design and branding and should be completed by the new employee. This needs to be completed even if the employee provides a P45.
Full Payment Submission (FPS)
The new starter information needed for the FPS is basically all of the information you have available for your new employee. Previous employment figures, Surname, Forename, Date of birth, Gender, Start date and Starter declaration are all needed for the FPS. You also need the National Insurance Number but leave the feild blank if you do not know it. You can use the new starter’s passport number to help match, if needed.
The FPS should be send on or before your employees’ pay day but there are some exceptions for this. It is possible for you to send the FPS early if this is easier for you to do so, if for example, your payroll staff are on holiday on the required dates.
HM Revenue and Customs (HMRC) have now introduced penalties for employers who report their payroll information late. This can also even be applied for a resubmission. The fines are as follows:
Number of employees
1 – 9
10 – 49
250 or more
The fines can be escalated also. If you are over three months late, you can be charged additionally at a rate of 5% of the tax and national insurance that you should have reported. If you run more than one PAYE scheme you can be charged for each separately.
You can also be charged interest on the fines if you do not pay them within the 30 day period.
IRIS Training is also a great resource that you can attend either in person at a seminar or from the comfort of your desk online via a webinar. 91% of people that attended IRIS Training said that they would recommend to their friends and colleagues. Our current training is centred on auto enrolment, the workplace pension reform.