INCOME TAX Citation and commencement 1 1 These Regulations may be cited as the Income Tax (Pay As You Earn) (Amendment No. 4) Regulations 2007. 2 Regulations 1, 2, 6, 7, 8, 18 and 23 of these Regulations come into force on 6th April 2008. 3 All other regulations of these Regulations come into force on 6th April 2009. Amendment of the Income Tax (Pay As You Earn) Regulations 2003 2 The Income Tax (Pay As You Earn) Regulations 2003 are amended as follows. 3 In regulation 36(4) (cessation of employment: form P45), in Table 2, insert the following after item 3 (employee’s name)— 3A. the employee’s date of birth yes no no 3B. the employee’s sex yes no no 4 In regulation 42(7) (procedure if employer receives form P45)— a in sub-paragraph (g), omit “if known,”; and b after sub-paragraph (g), insert— ga the employee’s sex, . 5 In regulation 43(9)(c) (Form P45 for current tax year), for “(retirement statement)” substitute “(Form P46(Pen))”. 6 In regulation 47 (procedure in Form P46 cases: Statement A applies)— a in paragraph (2), for “exceeds the PAYE threshold” substitute “equals or exceeds the lower earnings limit”; b for paragraph (2)(a) substitute— a send the Form P46 to Her Majesty’s Revenue and Customs, ; c after paragraph (2) insert— 2A To comply with paragraph (2)(a)— a the employer must send the Form P46 to Her Majesty’s Revenue and Customs even if the employee has not provided all of the information required by regulation 46, and b the employer must provide any of the information required by regulation 46(1B) that the employee has not provided. ; and d after paragraph (3) add— 4 In this regulation, “lower earnings limit” means the lower earnings limit for Class 1 contributions for the purposes of section 5(1) of the Social Security Contributions and Benefits Act 1992 . . 7 In regulation 48 (procedure in Form P46 cases: Statement B applies)— a in paragraph (2), for “exceeds the PAYE threshold” substitute “equals or exceeds the lower earnings limit”; b for paragraph (2)(a) substitute— a send the P46 to Her Majesty’s Revenue and Customs, ; c after paragraph (2) insert— 2A To comply with paragraph (2)(a)— a the employer must send the Form P46 to Her Majesty’s Revenue and Customs even if the employee has not provided all of the information required by regulation 46, and b the employer must provide any of the information required by regulation 46(1B) that the employee has not provided. ; and d after paragraph (3) add— 4 In this regulation, “lower earnings limit” means the lower earnings limit for Class 1 contributions for the purposes of section 5(1) of the Social Security Contributions and Benefits Act 1992. . 8 In regulation 49 (procedure in Form P46 cases: Statement C applies)— a for paragraph (2)(a) substitute— a send the Form P46 to Her Majesty’s Revenue and Customs, ; and b after paragraph (2) insert— 2A To comply with paragraph (2)(a)— a the employer must send the Form P46 to Her Majesty’s Revenue and Customs even if the employee has not provided all of the information required by regulation 46, and b the employer must provide any of the information required by regulation 46(1B) that the employee has not provided. . 9 In regulation 52 (late presentation of Form P45: employer’s duties)— a in paragraph (2)— i in sub-paragraph (g), omit “if known,”, ii after sub-paragraph (g), insert— ga the employee’s sex, ; and b in paragraph (11), for “(retirement statement)” substitute “(Form P46(Pen))”. 10 In regulation 53(3) (Form P46 cases: subsequent procedure on issue of employee’s code), for “(retirement statement)” substitute “(Form P46(Pen))”. 11 For the heading to Chapter 3 of Part 3 substitute— NEW PENSIONERS: FORMS P45 AND P46(PEN) . 12 In regulation 55 (PAYE pension income paid by former employer)— a in each of paragraphs (3), (4) and (5), for “retirement statement” substitute “Form P46(Pen)”; b in paragraph (3)(b), for “a copy” substitute “a copy of the information”; c in paragraph (4)— i in sub-paragraph (b), omit “if known,”, ii after sub-paragraph (b), insert— ba the pensioner’s date of birth, bb the pensioner’s sex, , iii in sub-paragraph (i), for “and the frequency of the payments” substitute “annually”; d in paragraph (5) omit “delivered to Inland Revenue”. 13 In regulation 56(2) (PAYE pension income paid by other pension payer)— a omit the “and” that follows sub-paragraph (b); b add at the end— d the pensioner’s date of birth, and e the pensioner’s sex. . 14 In regulation 57 — a for the heading substitute— Information to be provided in Form P46(Pen) if code not known: non UK residents ; b in paragraph (2), for “Form P46” substitute “Form P46(Pen)”. 15 In regulation 58 — a for the heading substitute— Information (Form P46(Pen)) and procedure if code not known: UK residents ; b in paragraph (3), for “Form P46” substitute “Form P46(Pen)”. 16 In regulation 59(2) (UK resident pensioner’s code treated as issued by Inland Revenue), for “Form P46” substitute “Form P46(Pen)”. 17 In regulation 61(3)(b) (subsequent procedure on issue of UK resident pensioner’s code), for “(retirement statement)” substitute “(P46(Pen))”. 18 In regulation 186 (recovery: adjustment of employee’s code), in each of paragraphs (3)(b)(ii) and (4)(b), for “1st October” substitute “1st November”. 19 For regulation 207(1) (specified information) substitute— 1 In this Chapter, “specified information” means— a Part 1 of Form P45; b Part 3 of Form P45; c Form P46; d Form P46(Pen); e the return and accompanying information required by regulation 73 (annual return of relevant payments liable to deduction of tax (Forms P35 and P14)). . 20 For regulation 210 (penalties and appeals) substitute— Penalty for failing to deliver specified information 210 1 A specified employer who fails to deliver specified information or any part of it in accordance with regulation 205 is liable to a penalty. 2 The penalty must be determined in accordance with regulation 210A where the specified information concerned is the return and accompanying information required by regulation 73 (annual return of relevant payments liable to deduction of tax (Forms P35 and P14)). 3 The penalty must be determined in accordance with regulation 210B in all other cases. 4 Regulation 210C applies irrespective of how the penalty falls to be determined. Penalty: regulation 73 return and accompanying information (Forms P35 and P14) 210A Table 9 sets out the penalty for the tax years ending 5th April 2005 to 5th April 2009, depending on the number of employees for whom particulars should have been included with the specified information. Table 9 Penalties: tax years ending 5th April 2005 to 5th April 2009 1. Number of employees for whom particulars should have been included with the specified information 2. Penalty 1 – 49 nil 50 – 249 nil for tax year ending 5th April 2005, £600 for subsequent years 250 – 399 £900 400 – 499 £1,200 500 – 599 £1,500 600 – 699 £1,800 700 – 799 £2,100 800 – 899 £2,400 900 – 999 £2,700 1000 or more £3,000 Penalty: Form P45 (Part 1 or Part 3), P46 or P46(Pen) 210B 1 This regulation applies for the tax quarter ending on 5th April 2010 and the tax year ending on 5th April 2011 (the “relevant period”). 2 Table 9A sets out the penalties for the relevant period depending on the number of items of specified information the employer has failed to deliver in each tax quarter falling within that period. Table 9A Penalties: tax quarter ending 5th April 2010 and tax year ending 5th April 2011 1. Number of items of specified information the employer has failed to deliver in the tax quarter 2. Penalty 1 – 5 Nil 6 – 49 £100 50 – 149 £300 150 – 299 £600 300 – 399 £900 400 - 499 £1,200 500 – 599 £1,500 600 - 699 £1,800 700 – 799 £2,100 800 – 899 £2,400 900 – 999 £2,700 1000 or more £3,000 3 Each of the types of specified information mentioned in sub-paragraphs (a) to (d) of regulation 207(1) counts as a separate item of specified information for this purpose. 4 An item of specified information counts even if it relates to the same employee as one or more other items. Appeals and interest 210C 1 An employer is not liable to a penalty if the employer had a reasonable excuse for failing to comply with regulation 205 which had not ceased at the time the specified information was delivered. 2 A notice of appeal against a determination under section 100 of TMA of a penalty can only be on the grounds that— a the employer is not a specified employer, subject to paragraph (3), b the employer did comply with regulation 205, c the amount of the penalty is incorrect, or d paragraph (1) applies. 3 An employer may not appeal on the grounds that the employer is not a specified employer if the employer has already appealed under regulation 208(2) (appeal against e-filing notice). 4 Section 103A of TMA (interest on penalties) applies to this penalty. . 21 In regulation 211(4) (how information must or may be delivered by employers), in Table 10— a for the entry relating to regulation 55(3)(a) substitute— 55(3)(a) information on retirement P46(Pen) yes yes b in column 3 of each of the entries relating to regulations 57(2) and 58(3), for “Form P46” substitute “Form P46(Pen)”. 22 In regulation 212— a for the heading substitute— Modifications for electronic version of Form P46(Pen) ; b in paragraph (1), for “the statement required by regulation 55(3)(a) (pensioner’s retirement statement: Form P160)” substitute “Form P46(Pen)”; and c in paragraph (2)— i for “retirement statement” substitute “Form P46(Pen)”, ii in each of sub-paragraphs (i) and (l), omit “if known,”. 23 In regulation 213(3) (how information may be delivered by Inland Revenue), in Table 11, add at the end— 199(1) e-payment notice MP(L)(Band 1) yes 206(1) e-filing notice MP(L)(Band 1) yes 24 In regulation 215— a for the heading substitute— Meaning of Form P45, P46 and P46(Pen) ; b for the definition of “Form P46” substitute— “Form P46” means the form provided or approved for use in accordance with regulation 46 (form P46 where employer does not receive P45 and code not known); ; and c after that definition add— “Form P46(Pen)” means the form provided or approved for use in accordance with regulation 55(3)(a), 57(2) or 58(3). . Paul Gray Mike Hanson Two of the Commissioners for Her Majesty’s Revenue and Customs 12th October 2007