Part 11Pay As You Earn

Chapter 2PAYE: general

684PAYE regulations

(1)

F1The Commissioners F2... must make regulations (“PAYE regulations”) with respect to the assessment, charge, collection and recovery of income tax in respect of all PAYE income.

(2)

F3The provision that may be made in PAYE regulations includes any such provision as is set out in the following list.

List of Provisions

1. Provision—

(a)

for requiring persons making payments of, or on account of, PAYE income to make, at the F4relevant time, deductions or repayments of income tax calculated by reference to tax tables prepared by F1the Commissioners F5..., and

(b)

for making persons who are required to make any such deductions or repayments accountable to or, as the case may be, entitled to repayment from the Board.

F6“The relevant time” is—

(a)

if the payment is a notional payment for the purposes of section 710 and the person is treated by virtue of any Act as making it at a time before the date on which the Act is passed, that date, and

(b)

in any other case, the time when the payment is made.

F71ZA. Provision—

(a)

for authorising a person (“P”), in a case where the PAYE income of an employee (whether an employee of P or of another person) includes an amount charged to tax under any of F8Chapters 3 to 10 of Part 3 in respect of the provision of a benefit of a specified kind—

(i)

to make deductions of income tax in respect of the benefit from any payment or payments actually made of, or on account of, PAYE income of the employee, or

(ii)

to make repayments of such income tax,

(b)

for any such deductions or repayments to be made at a specified time,

(c)

for the amount of any such deductions or repayments to be calculated in accordance with the regulations,

(d)

for the provision of the benefit to be treated for specified purposes as a payment of PAYE income, and

(e)

for making persons who make any such deductions or repayments accountable to or, as the case may be, entitled to repayment from the Commissioners.

F91A. Provision—

(a)

for deductions to be made, if and to the extent that the payee does not object, with a view to securing that income tax payable in respect of any income of a payee for a tax year which is not PAYE income is deducted from PAYE income of the payee paid during that year; and

(b)

as to the circumstances and manner in which a payee may object to the making of deductions.

2. Provision—

(a)

for repayments or deductions to be made, if and to the extent that the payee does not object, in respect of any amounts overpaid or F10(or treated as overpaid) on account of, or any amounts other than relevant debts remaining unpaid (or treated as remaining unpaid) on account of—

(i)

income tax in respect of income for a previous tax year, or

(ii)

capital gains tax in respect of chargeable gains for such a year; and

(b)

as to the circumstances in which repayments or deductions may be made, and the circumstances and manner in which a payee may object to the making of repayments or deductions.

F112ZA. Provision—

(a)

for deductions to be made, if and to the extent that the payee does not object, with a view to securing that income tax payable for a tax year by the payee by virtue of section 681B (high income child benefit charge) is deducted from PAYE income of the payee paid during that year,

(b)

for repayments to be made in a tax year, if and to the extent that the payee does not object, in respect of any amounts overpaid on account of income tax under that section for that tax year, and

(c)

as to the circumstances and manner in which a payee may object to the making of deductions or repayments.

F122A. Provision—

(a)

for deductions to be made in respect of relevant debts of a payee,

(b)

as to the circumstances in which such deductions may be made, and

(c)

where such deductions are made, as to the date on which the relevant debts are to be treated as paid.

3. Provision for the production to, and inspection by, persons authorised by the Board of wages sheets and other documents and records for the purposes of satisfying themselves that F13amounts have been and are being deducted, repaid and accounted for in accordance with the regulations.

4. Provision for requiring an employer or former employer to provide any information, within a prescribed time, about payments or other benefits provided or to be provided, including those provided or to be provided in connection with—

(a)

the termination of a person’s employment, or

(b)

a change in the duties of or general earnings from a person’s employment.

F144ZA. Provision-

(a)

for authorising or requiring a person who provides with respect to payments of or on account of PAYE income a service that is specified or of a specified description (“a relevant payment service”) to supply to Her Majesty's Revenue and Customs information about payments with respect to which the service is provided, or any information the Commissioners may request about features of the service provided or to be provided with respect to particular payments;

(b)

for conferring power on the Commissioners to specify by directions circumstances in which provision made by virtue of paragraph (a) or subsection (4ZB) is not to apply in relation to a payment;

(c)

for securing that a supply of information that is authorised by regulations under paragraph (a) is not treated as breaching any obligation of confidence owed in respect of the information by the person supplying it;

(d)

for prohibiting or restricting the disclosure, otherwise than to Her Majesty's Revenue and Customs, of information by a person to whom it was supplied pursuant to a requirement imposed by virtue of subsection (4ZB);

(e)

for requiring a person who provides, or is to provide, a relevant payment service to take steps (including any steps that may be specified, or further specified, in accordance with item 8A(b)) for facilitating the meeting by persons making payments of obligations imposed by virtue of subsection (4ZB).

F154A. Provision authorising the recovery from the payee rather than the payer of any amount that F16an officer of Revenue and Customs considers should have been deducted by the payer.

F174B. Provision for and in connection with requiring the giving, in specified circumstances, of security (or further security) for the payment of amounts in respect of which a person is or may be accountable to the Commissioners under the regulations.

5. Provision for the way in which any matters provided for by the regulations are to be proved.

6. Provision—

(a)

for requiring the payment of interest on sums due to the Board which are not paid by the due date,

(b)

for determining the date (being not less than 14 days after the end of the tax year in respect of which the sums are due) from which such interest is to be calculated, and

(c)

for enabling the repayment or remission of such interest F18or interest under section 101 of FA 2009 .

7. Provision for requiring the payment of interest on sums due from the Board and for determining the date from which such interest is to be calculated.

F197A. Provision for excluding payments of such description as may be specified from the operation of the regulations in such circumstances as may be specified. Provision for excluding payments of such description as may be specified from the operation of the regulations in such circumstances as may be specified.

8. Provision for the making of decisions by F20Her Majesty’s Revenue and Customs as to any matter required to be decided for the purposes of the regulations and for appeals against such decisions.

F218A. Provision requiring compliance with any directions the Commissioners may give—

(a)

about the form and manner in which any information is to be provided under the regulations;

(b)

specifying, or further specifying, steps for the purposes of item 4ZA(e);

(c)

specifying information that a person making payments of or on account of PAYE income must provide about the method by which the payments are made.

9. Provision for appeals with respect to matters arising under the regulations which would otherwise not be the subject of an appeal.

10. Different provision for different cases or classes of case.

11. Any incidental, consequential, supplementary and transitional provision which appears to the Board to be expedient.

(3)

F22The deductions of income tax—

(a)

required to be made by PAYE regulations under item 1 in the above list, or

(b)

which a person is authorised to make by PAYE regulations under item 1ZA in that list,

may be required to be made at the basic rate or other rates in such cases or classes of case as may be provided by the regulations.

F23(3A)

PAYE regulations under item 2A in the above list may not make provision enabling deductions totalling more than F24£17,000 to be made from a payee's income for a tax year without the payee's consent.

(3B)

The Treasury may by order amend the amount specified in subsection (3A).

F25(3C)

References in items 4ZA and 8A of the above list to directions include directions making different provision for different cases.

(4)

Interest required to be paid by PAYE regulations under item 6 or 7 in the above list F26or by section 101 of FA 2009, in connection with sums due to the Commissioners under the PAYE Regulations, must be paid without any deduction of income tax and may not be taken into account in computing any income, profits or losses for any tax purposes.

F27(4ZA)

Item 8A in the above list does not prejudice the power of the Commissioners under subsection (1) to make provision in PAYE regulations about the matters mentioned in that item.

(4ZB)

The persons to whom PAYE information regulations may require information to be supplied include, in the case of information about a payment, a person who provides, or is to provide, with respect to the payment a service such as is mentioned in item 4ZA(a) in the above list.

(4ZC)

In subsection (4ZB) “PAYE information regulations” means PAYE regulations that require information to be supplied for any purpose authorised by subsections (1) and (2).

F28(4A)

A person who fails to comply with a requirement imposed under PAYE regulations to give security, or further security, for the payment of any amount commits an offence if the failure continues for such period as is specified; and a person guilty of an offence under this subsection is liable F29on summary conviction—

(a)

in England and Wales, to a fine;

(b)

in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale

(5)

PAYE regulations must not affect any right of appeal to the F30tribunal which a person would have apart from the regulations.

(6)

It does not matter for the purposes of PAYE regulations that income is wholly or partly income for a tax year other than that in which the payment is made.

(7)

PAYE regulations have effect despite anything in the Income Tax Acts.

(7A)

F31Nothing in PAYE regulations may be read—

(a)

as preventing the making of arrangements for the collection of tax F32or other amounts in such manner as may be agreed by, or on behalf of, the payer and F16an officer of Revenue and Customs, or

(b)

as requiring the payer to comply with the regulations in circumstances in which F16an officer of Revenue and Customs is satisfied that it is unnecessary or not appropriate for the payer to do so.

F33(7AA)

In this F34Part “relevant debt”, in relation to a payee, means—

(a)

a sum payable by the payee to the Commissioners under or by virtue of an enactment, other than an excluded debt, and

(b)

a sum payable by the payee to the Commissioners under a contract settlement.

(7AB)

For the purposes of subsection (7AA)—

(a)

child tax credit or working tax credit that the payee is liable to repay is an excluded debt, and

(b)

if the payee is an employer, any amount that the payee is required to deduct from the PAYE income of employees for a tax year is an excluded debt until the tax year has ended.

(7B)

References in this section and section 685 to income tax in respect of PAYE income are references to income tax in respect of that income if reasonable assumptions are (when necessary) made about other income.

(7C)

In this section and section 685—

F35“the Commissioners” means the Commissioners for Her Majesty's Revenue and Customs;

“contract settlement” means an agreement made in connection with the liability of the payee or another person to make a payment to the Commissioners under or by virtue of an enactment;

“payer” means any person paying PAYE income and “payee” means any person in receipt of such income;

“specified” means specified in PAYE regulations.

(8)

In this Act and any other enactment (whenever passed) “PAYE regulations” means regulations under this section.