Employers: File P45 and P46 Forms Online and On Time

Employers are being reminded to submit their in-year PAYE forms to HM Revenue & Customs (HMRC) when an employee leaves or joins their company. The P45 and P46 starter and leaver forms must be filed correctly as failing to do so may result in penalties, warns the Institute of Chartered Accountants in England and Wales (ICAEW).

Employers with 50 or more employees must file their forms online. They must not submit a paper copy of the form, even as a duplicate or in advance of filing online. Depending on the number of forms which an employer has failed to send online, they could face a penalty of up to £3000.

If employers have fewer than 50 employees then filing these forms online is not compulsory until 6 April 2011. However, HMRC is advising these employers that while they are getting used to using the online service to file End of Year Returns, they could get ahead of the game and file their employee starter and leaver forms online too.

Filing online before the 2011 deadline will give employees plenty of time to learn how the process works and to get used to any new software or business processes. It is likely that employers and payroll managers will need to examine their payroll practices and systems to prepare in advance for these changes. Anita Monteith, ICAEW’s Tax Faculty Technical Manager, says

“To avoid penalties employers need to ensure they do not send HMRC forms on paper when they should be filed online, or send two versions of the same form. Online filing is quick, secure and convenient, and can cut down on errors and the delays they can cause.”

For further information, please see www.hmrc.gov.uk


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