October 25, 2013 - Rachel Miller
HM Revenue & Customs (HMRC) has announced that it will shut down unused Pay As You Earn (PAYE) schemes. Employers who have not used their schemes will now receive letters explaining that their PAYE schemes have been closed.
Any PAYE schemes opened after 5 April this year will be shut down automatically where the employer has not sent any PAYE returns or paid HMRC within four months of the scheme being set up. However, schemes registered as annual schemes will not be closed by this process.
From October 2013, PAYE schemes will automatically be closed where:
Ruth Owen, HMRC's director general for personal tax, said: "Closing schemes that are no longer needed is really important for businesses and for HMRC as it means that HMRC won't waste employers' or taxpayers' time and money by needlessly pursuing returns or debts when in fact none are due.
"Since April, employers or agents (acting on behalf of their clients) who have set up PAYE schemes that are no longer needed can easily close the scheme by reporting this on their final submission."
More than 1.69 million employer PAYE schemes, covering over 46 million individual records, are reporting in real time (RTI) since the launch of new reporting requirements in April this year.
Deadline day for paper returns
There are just days left to send your 2012/13 paper tax return to HMRC, if you want to beat the 31 October deadline and avoid a penalty. Businesses that send their paper tax returns on or after 1 November will have to pay a £100 penalty – even if there is no tax to pay or the tax due is paid on time. You can avoid a late-filing penalty by sending your return online by 31 January.