PSA changes alleviate employers of unnecessary administration

The process for administering and agreeing PAYE Settlement Agreements (PSA) has been changed to “reduce the burden for employers”, a recent tax office document has confirmed.
The change, which took effect from 6 April 2018, means PSAs will be agreed between the employer and HM Revenue & Customs (HMRC) and will remain in place for subsequent tax years unless either party wishes to make a change or cancel the agreement.
Under the previous rules, the PSA would need to be reviewed annually – adding unnecessary administration time for the employer.
However, the employer should still keep a careful eye on what agreements are in place and update where necessary to keep them accurate and up to date, to avoid under or overpayment of tax.
A PSA allows you to make one annual payment to cover all the tax and national insurance due on minor, irregular or impracticable expenses or benefits for your employees. This can include items such incentive awards, relocation expenses over £8,000, shared cars and the costs of attending overseas conferences. This list is not exhaustive.
Employers wishing to complete a PAYE can do so by following the link here. Alternatively, we can set one or more up on your behalf.

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