When is Your PAYE Due?

Newsletter issue - February 2010.

This is an easy question – all PAYE and NIC deductions, including student loan repayments, and CIS deductions for the tax period ending on 5th of the month must be paid to HMRC by 19th of that same month. This means your cheque must reach the Taxman's accounts office by the last working day before the 19th. If you pay electronically the payment must reach the Taxman's account by 22nd of each month. In most cases you will need to set-up the payment to leave your bank account on or before 19th as the Taxman's bank does not accept 'faster payments', which arrive the same day as they leave.

If all your average monthly PAYE deductions for the tax year are less than £1,500 you can pay those deductions to the Taxman each quarter instead of monthly. In this case the deductions must reach the Taxman's accounts office by 19th July, 19th October, 19th January and 19th April. If you pay electronically the payment must arrive by 22nd of the relevant months.

These deadlines are particularly important for sub-contractors in the construction industry who currently have 'gross payment' status.

Gross payment status allows those firms to be paid without deduction of tax. But the Taxman will withdraw gross payment status if you are up to 14 days late with more than three PAYE payments. If you are more than 14 days late for just one payment gross payment status will be withdrawn. You can appeal against the withdrawal of gross payment status, but you need a good excuse for making the late payments!

From May 2010 all employers will be subject to late payment penalties if they are late with more than one PAYE payment in the tax year. If you regularly pay your PAYE late we should discuss how to improve your systems before the new penalties start.