Payroll Advanced Technician - Step 3

The course includes:

Calculation of termination payments and their treatment for Tax an NI.

Calculation of NI contributions where there are multiple employments with the same organisation.

Calculation of the Tax and NI on employee benefits, and the reporting procedures. This part of the course is designed to impart expert knowledge about the completion of P11D returns of expenses and benefits.

Students are given practical examples of the various calculations involved with the course content and are supplied with various manuals to enhance the learning experience.

Year-end returns P11D P9D

This part of the programme is designed to impart expert knowledge about the completion of P11D returns of expenses and benefits. The objective is to enable employers to avoid the costly penalties and fines that the Inland Revenue can impose for late and incorrect returns.

It is claimed that more incorrect returns are sent to the Inland Revenue each year than correct ones, due mainly to a lack of appreciation of the extent of the information that must be reported for what, in many companies, may be the majority of employees.

We hear the expression “I just didn’t realise it meant that” on this programme more than any of the others that we run. Often the sentiment comes from people who have been completing P11Ds for many years but have had no formal training or have simply not kept up-to-date with the ever-changing legislation.

Termination Payments

Learning Objectives for Step 3

Year-end Returns

-Step-by-step review of each year-end return, including P14 End of Year Summary, P60 End of Year Certificate, P38S Students Employed During the Holiday, P35 Employer's Annual Return, P38A Employer's Supplementary Return P38A
-How to complete each form and many valuable tips on year-end procedures

Advanced Payroll Calculations

-Understanding the ‘net pay’ arrangement
-Money Purchase pension schemes, minimum payments and age-related rebates
-Appropriate Personal Pensions and age-related rebates
-Calculating NICs using the exact percentage method
-Gross-to-net checklist and practical exercise
-Payments made after leaving – how should they be treated
-Correcting mistakes when deducting tax and NICs
-Making payments free of tax and NICs
-Employment status for NICs
-Earnings periods – how they are determined for employees and Directors

Earnings for tax and NICs

-Determining the correct tax and NIC treatment – payroll or P11D?
-Understanding how to process reimbursed expenses correctly, especially those where they could be tax-free or not, such as eye-tests and glasses and mileage allowance payments
-Problem areas for Class 1 NICs
-Class 1A NICs and benefits-in-kind
-Class 1B NICs and PSA/TASs
-ESCs and statutory exceptions
-Termination payments – how to determine whether tax and NICs are due
-Notional payments – what are they and how to deal with them

Overview of the P11D

-Timetable and penalties, fines and interest charges
-The use of alternative forms, software and working sheets
-How dispensations, Extra Statutory Concessions (ESCs), Statutory Exemptions, Personal Incidental Expenses (PIEs), PAYE Settlement Agreements (PSAs) and Taxed Award Schemes (TASs), affect completion of the P11D form

Completing the P11D – step-by-step

-Assets transferred (cars, property, goods or other assets)
-Payments made on behalf of employee
-Vouchers or credit cards
-Living accommodation
-Mileage allowance payments (new reporting requirements)
-Cars and car fuel (new reporting requirements)
-Interest-free and low interest loans
-Private medical treatment or insurance
-Qualifying relocation expenses payments and benefits
-Services supplied
-Assets placed at the employee’s disposal
-Shares
-Other items (including subscriptions and professional fees)
-Expenses payments made to, or on behalf of, the employee

Completing the P11D(b)

-Determining the benefits-in-kind that attract Class 1A NICs
-Calculating Class 1A liability
-Understanding what adjustments may need to be made
-Timetable, penalties and payments

Completing the P9D

-Overview of the differences between P11D and P9D
-Which employees require a P9D form