Employee Database Records - HMRC delays migration of PAYE data

Written by Ian Congreave - Filed under: Services on July 28th, 2008

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UK flag In June 2008, HRMC announced that “the biggest change to PAYE for over 20 years” would take place in October 2008. This was not a reference to the introduction of online filing of in-year forms, nor to revolutionary new PAYE procedures. Rather, it described the start of the process of merging all employee records onto a single database, providing HMRC staff with access to all employees’ pay, tax, NICs and pension information in one place. The migration was to have created service restrictions during October 2008.

However, HMRC announced on 16 July its decision to defer the implementation of the new PAYE Service and Work Management System. In explaining the delay, HMRC states:

“We recognise the huge importance of the changes we are making to PAYE processing and the customer service improvements they will bring.

When we designed the system, we based the design on the information available at that time. The implementation of the new PAYE Service … will change our internal procedures on handling internal data. It will introduce higher levels of automation, improve accuracy and efficiency of processing, and enhance our management information and workflow management. This has generated higher internal transaction volumes than we originally forecast. We have decided it would be sensible to defer implementation while we make some design changes to accommodate the higher volumes.

We will not implement the new PAYE system until we can be sure it will meet the demands that will be placed upon it.

A later implementation date will delay the introduction of the benefits that the new PAYE service will bring, but given the scale and importance of PAYE, we will only go ‘live’ when we are satisfied that the changes will deliver the expected benefits and not cause unnecessary disruption.

At this stage a new implementation date has not been set. The new date will be determined by a variety of factors including, of course, the best time in the annual PAYE cycle.”

Of the various service restrictions announced earlier, the only ones that will still occur are:

HMRC’s PAYE Online Returns and Forms service will not be available in the five days ending on 27 October while improvements are made. During these five days, the following records will be deleted:
- all Employer Annual Returns submitted for tax years 2003/04 and 2004/05
- any other forms and returns submitted before 6 April 2005
- anything else that has been entered on to the current system but has never actually been filed, irrespective of the date it was created.
Even though the migration of PAYE records will not yet take place, HMRC will still withdraw the facility to issue notification of bulk P6/P9 tax code changes list after August 2008. This is a little-used process and many employers have already made alternative arrangements to receive this data electronically.

There is no change, however, to the introduction of

mandatory online filing of in-year forms by employers with 50 or more employees from April 2009, and for all other employers from April 2011
the new A4-size P45s in October 2008 and the facility for employers to print Parts 1A to 3 on plain paper
the new P46(Expat) and P46(Pen) forms from April 2009.

Further information:
Deferral of the new PAYE Service from October 2008

The UK Payroll News is sponsored by HRD & Payroll Solutions

Written by Ian Congreave - Payroll writer and lecturer

Filed under: Services on July 28th, 2008