The Income Tax (Pay As You Earn) Regulations 2003

PAYE income paid after employment ceased U.K.

37.—(1) This regulation applies if a relevant payment is made to an employee after the employment has ceased—

(a) by the former employer in respect of the former employment, or

(b) by any other person in respect of an obligation of the former employer,

and the payment has not been included in Form P45.

[F1 (1A) But this regulation does not apply if regulation 37A applies.]

[F2 (2) Subject to paragraph (2A), the person making the payment must deduct tax on the non-cumulative basis using the 0T Code.

(2A) If the payment is in the form of securities, an interest in securities or securities options which gives rise to earnings within Chapter 1 of Part 3 of ITEPA or which counts as employment income by virtue of Part 7 of ITEPA, the person making the payment must deduct tax at the basic rate in force for the tax year in which the payment is made.

(2B) In paragraph (2A)—

“interest”,

“securities”, and

“securities options”

have the meaning indicated in section 420 of ITEPA]

(3) But—

(a) the payment does not affect the cessation of employment, and

(b) the provisions listed in paragraph (4) do not apply.

(4) The provisions are—

regulation 21	deduction and repayment of tax by reference to employee’s code
regulations 22 and 23	cumulative basis
F3 . . .	F4 . . .
Chapters 2 and 3 of this Part	new employees and new pensioners: Forms P45 and P46.

(5) The person making the payment must record the following information in a deductions working sheet (which the person must prepare for the purpose if one has not already been prepared for that tax year).

(6) The information is—

(a) the date of the payment,

(b) the amount of the relevant payment, and

(c) the amount of tax deducted on making the payment, or to be deducted or accounted for under regulation 62(4) or (5) (notional payments).

(7) The person making the payment must also notify the employee of the information mentioned in paragraph (6) without unreasonable delay.

Textual Amendments

F1 Reg. 37(1A) inserted (6.4.2007) by The Income Tax (Pay as You Earn) (Amendment) Regulations 2007 (S.I. 2007/1077), regs. 1, 5

F2 Reg. 37(2)-(2B) substituted for reg. 37(2) (6.4.2011) by The Income Tax (Pay As You Earn) (Amendment) (No.2) Regulations 2011 (S.I. 2011/1054), regs. 2, 3

F3 Words in reg. 37(4) omitted (6.4.2011) by virtue of The Income Tax (Pay As You Earn) (Amendment) Regulations 2011 (S.I. 2011/729), regs. 1, 8(b)(i)

F4 Words in reg. 37(4) omitted (6.4.2011) by virtue of The Income Tax (Pay As You Earn) (Amendment) Regulations 2011 (S.I. 2011/729), regs. 1, 8(b)(ii)

Commencement Information

I1 Reg. 37 in force at 6.4.2004, see reg. 1