Reforms to the administration of Pay As You Earn (PAYE) Settlement Agreements (PSA) have been proposed by HMRC.
The current process for administering and agreeing PSAs is burdensome for employers. Under the proposals, employers operating PSAs will benefit from:
removal of the requirement for employers to renew their PSAs annually, and instead creating an enduring agreement. Agreements will remain in place for subsequent tax years unless varied or cancelled by the employer or HMRC future-proofing the regulations to allow for a digitised process if, and when, this can be introduced.Employers will still be required to provide an annual calculation. However, these changes are scheduled to take effect from 6 April 2018 for the tax year 2018 to 2019.
HMRC recently undertook a consultation to seek views on the changes, which it is now considering. To allow this consultation to take place, HMRC will delay the issue of P626’s for the tax year 2018 to 2019 until April 2018.
