HMRC launches new online service to apply for, amend or cancel a PAYE settlement agreement.
A new online service is available from HMRC for employers and their agents to apply for a PAYE settlement agreement (PSA). Employers and agents can also use the online service to amend or cancel an existing PSA.
This new service is available from 6 April 2023.
When going online, you need your employer PAYE reference. This is a three-digit number, a forward slash and then a mix of letters and numbers, like 123/AB456. You can find this on letters from HMRC about PAYE.
You also need contact details, including:
- the name of your business
- an address
- your telephone number
- your email address (unless you sign in with a government gateway user ID).
The deadline for applying for a PSA is 5 July following the first tax year it applies to. For tax year 2022/23, you have until 5 July 2023 to apply for a PSA.
What you can include in your PSA payment depends on when you apply. If you applied for a PSA before the start of a tax year, you can include any expenses and benefits contained in the agreement. If you applied for a PSA after the start of the tax year, you might need to report some items separately (eg, on form P11D).
You must pay any tax and class 1B NIC owed under a PSA by 22 October after the tax year that the PSA applies to (19 October if paying by cheque).
The expenses or benefits to include in a PSA must be minor, irregular or impracticable (impracticable means expenses and benefits that are difficult to place a value on or divide up between individual employees). Trivial benefits do not need to be reported to HMRC so should not be included in a PSA.
ICAEW’s Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.