The Income Tax (Pay As You Earn) (Amendment) (No.2) Regulations 2008

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend the Income Tax (Pay As You Earn) Regulations 2003 (S.I. 2003/2682) (“the PAYE Regulations”).

Regulation 1 provides for citation and commencement.

Regulation 2 introduces the amendments.

Regulation 3 inserts a new Chapter 5 into Part 8 of the PAYE Regulations. This Chapter contains provisions relating to the operation of PAYE on the employment and support allowance (“ESA”) which was introduced by the Welfare Reform Act 2007 and, in Northern Ireland, the Welfare Reform Act (Northern Ireland) 2007. The conditions for entitlement to ESA are contained in the Employment and Support Allowance Regulations 2008 (S.I. 2008/794) and, in Northern Ireland, the Employment and Support Allowance Regulations (Northern Ireland) 2008 (S.R. 2008/280).

Regulation 4 amends regulation 211 of the PAYE Regulations (how information must or may be delivered by employers). The regulation inserts new entries into table 10 containing specific provisions relating to ESA.

Regulation 5 amends regulation 214 of the PAYE Regulations (how information must be provided by employers). The regulation inserts an entry in table 12 setting out the form that an ESA claimant who is certifying that he or she is in full time education must use.

Regulation 6 amends regulation 215 of the PAYE Regulations (meaning of Form P45 and P46) to include references to the regulations relating to ESA.

A full regulatory impact assessment has not been produced for this instrument as no impact on the private or voluntary sectors is foreseen. An assessment of the impact of the Employment and Support Allowance Regulations 2008 has been made. Copies of this impact assessment may be obtained from the Better Regulations Unit of The Department for Work and Pensions, Level 4, The Adelphi, 1-11 John Adam Street, London, WC2N 6HT or from the DWP website: http://www.dwp.gov.uk/resourcecentre/ria.asp.