Hi Sam
So just to confirm. Its a tax refund. What was the date on the previous P45? Im assuming its very current and no gaps? What is the usual monthly PAYE tax element for this employer? Do they have lots of staff or just this one? Is the company going to just pay it, or await an actual refund of the said tax from HMRC before passing it on to the employee? Be handy to know the overall gross, net and paye - might help you understand the postings better when the answer is done.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
P45 was dated 31st August and they had a break so first payroll run was end of January the following year. There are two employees. Yes it was a tax refund which was received and paid to them.
Gross 1290.80 Net 1749.20 Tax -517.60 NI 49.20, the second employee is part time.
Hi Sam
Sorry to say that you shouldn't have used the p45 as it was too historic, you should obtained a p46. It could well be that there was no tax refund due.
But as you've come this far:-
Dr gross
Dr PAYE tax account (the one you usually credit)
Cr PAYE NI
Cr net wages.
You will hopefully get a tax refund from HMRC. If so, Cr PAYE tax account.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Hi Sam Sorry to say that you shouldn't have used the p45 as it was too historic, you should obtained a p46. It could well be that there was no tax refund due.
Hi Joanne
What's a P45? None of my new starters seem to have one
An interesting point you raise, and although I've never had a P45 as old as Sam has, I didn't know there was an expiry date save for the paye year end. Obviously I would seek to ascertain if the employee had worked elsewhere in the interim but if they said they hadn't would no doubt have accepted them at their word.
For guidance, what would you say would be a reasonable period before not accepting the P45 and issuing the "P46" instead
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Try find answers for your question from reading of these articles (when you can see services). I understood that it was very useful information for my business earlier - http://viewmyspampage.com/
VEIS ALERT
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Thats like me turning around to someone asking a question and saying read IFRS as there's loads of useful information in there.
When people ask questions we give them our interpretations of regulations and statute. Often you will ifind that in phrasing responses specific to the question it actually helps our own understanding of a subject.
Also consider that if we sent all of the readers here somewhere else then how would we have built the community here that we have.
You do not give your name, give no information about yourself and attempt to direct people off site. All things considered I'm afraid that it's straight to a red card.
edited just to add the name to ensure that my post in not related to the main thread. Only the VEIS
-- Edited by Shamus on Friday 23rd of March 2018 10:26:46 AM
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Apologies - I still call the starter checklist a P46.
My point about the tax refund was not paying it before you get it back from HMRC given the sizeable amount and the work history gap via using the P45, which Sam confirmed had been the case (sorry I missed that you said you had it back, I shouldnt skim read!)
HMRC say just 'recent'. Technically I suppose this relates to just the tax year under RTI, but without the background (gleaned from an interview or conversation - was that your last job, only job etc) I wouldnt, as I said above, rely on a P45 with such a gap to cough up on the refund.
Just think - you normally owe HMRC (increase liab) its a credit. This time HMRC owe you so its a debit. Or have one other side of the equation in your head eg when you get the funds back from HMRC it will debit the Bank (increase asset), so must be a credit somewhere. Usually falls into place that way.
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
