PAYE Compliance Health Checks

 

In recent years there has been a large increase in employer compliance visits by HMRC. Due to this there has been a significant rise in penalties charged for non-compliance as employers’ struggle to keep up with the changes of legislation. In recent months it is evident that employers who are using off payroll workers are being targeted by HMRC to question the status of workers.

 

What is a PAYE Compliance Check?

No matter the size of your business, you could receive a letter from HMRC and have to face the stress and scrutiny that comes with a PAYE compliance visit. The visit will aim to determine whether your company is successfully recording all employee charges and the appropriate tax is being paid.

If you are to be checked then HMRC will first let you know by letter with at least 7 days’ notice, which will be headed with ‘Check of Employer Records’.

 

What will be Involved?

It is essential that you know what you need to do to prepare for the visit if you are to be checked. If you have not had a PAYE compliance visit by HMRC before then it is worth noting that your payroll function will not be the only focus of the check.

The following is a list of other areas which may be checked during the visit:

• Benefits in kind (i.e. cars, vans, fuel, medical benefits)
• Payment of expenses such as travel subsistence, entertainment, staff welfare
• Termination Payments
• Status of workers
• NMW/NLW
• Salary Sacrifice/Incentive schemes
• Overseas workers/staff relocations
• CIS (Construction Industry Scheme)
• Beneficial loans/directors loan accounts

 

As your accountants, HMRC will be aware that we are authorised to act in respect of your business, however they may not have a record of our authority to act in relation to PAYE matters. As such we would not receive any prior notification of the compliance check taking place. If you do receive a letter from HMRC for a Check of Employer Records, then please contact us as soon as possible and we will do all we can to help you.

 

What Can We do?

Providing that all the information supplied to us is accurate, as your payroll provider we will help you to ensure compliance in all payroll related matters.

If you are ever contacted by HMRC for a PAYE compliance check, we would be able to help by:

• Conducting a thorough review of your payroll policies and procedures
• Help identify any potential problems
• Make recommendations of how to resolve any problems

 

If you would like to discuss your payroll and see what we can do for you then please do not hesitate to contact us.