The Income Tax (Employments) (Amendment) Regulations 2003

Explanatory Note

(This note is not part of the Regulations)

These Regulations amend the Income Tax (Employments) Regulations 1993 (S.I. 1993/744) (the “PAYE Regulations”) to provide for mandatory electronic communications.

Regulation 1 provides for citation and commencement.

Regulation 3 amends regulation 2D of the PAYE Regulations to make that regulation apply to all electronic payments but only to electronic delivery of information by means of an approved method of electronic communication.

Regulation 4 amends regulation 3 of the PAYE Regulations to provide that an election under regulation 3 shall be disregarded if it is made wholly or mainly for the purpose of avoiding a requirement to make electronic payment or use electronic communications, or to secure an incentive payment on using electronic communications.

Regulation 5 and 6 amend regulations 40 and 41 of the PAYE Regulations respectively to provide for a later due date for electronic payments.

Regulation 7 inserts new regulations 42A and 42B.

New regulation 42A imposes a requirement on large employers to use an approved method of electronic communications for making specified payments.

New regulation 42B imposes a default surcharge where a payment required to be made by an approved method of electronic communications is not received in full by the Inland Revenue on or before the relevant due date.

Regulation 8 inserts new regulations 46ZC to 46ZI which impose a requirement to use electronic communications for the delivery by certain employers of information required to be delivered under the regulation 43 of the PAYE Regulations.

New regulation 46ZC imposes a requirement on specified persons to use electronic communications for the delivery of specified information.

New regulation 46ZD makes provisions to determine specified persons.

New regulation 46ZE makes provisions to determine specified information.

New regulation 46ZF provides for the standards of accuracy and completeness for information delivered by means of electronic communication to be set by specific or general directions given by the Commissioners of Inland Revenue and provides that information which fails to meet these standards shall be treated as not having been delivered.

New regulation 46ZG provides for penalties up to the tax year ending 5th April 2009 where information is delivered otherwise than by means of an authorised method of electronic communication. New Regulations will be made for the tax year ending 5th April 2010 and subsequent years of assessment.

New regulation 46ZH provides for provisions of the Taxes Management Act (c. 9) to apply to appeals under these Regulations.

Regulations 9 and 10 amend regulations 47 and 48 of the PAYE Regulations respectively to provide a later date for the issue by the collector of a notice relating to unpaid tax.

Regulation 11 amends regulation 51 of the PAYE Regulations to provide a later date from which interest runs on unpaid tax where payment is due by an approved method of electronic communications.

Regulatory Impact Assessments for these Regulations are available, and the directions referred to in the Regulations will, when published in October 2003, be available, on the Inland Revenue website at www.inlandrevenue.gov.uk. The Assessments and the directions will also be available from the Inland Revenue Press Office, whose telephone number is 020 7438 6420.