Are you making the correct PAYE payments?

PAYE payments paid correctly to HMRC

Are you making the correct PAYE payments?

Are you or your clients making PAYE payments to HM Revenue & Customs (HMRC)?

Fresh warnings are out by HMRC to remind employers to ensure that their payment reference numbers are correct so that payments are recognised.

Each payment reference number relates to a specific employer and covers a particular accounting period.

HMRC uses these reference numbers to allocate payments and help process taxes related to PAYE payments as quickly as possible.

The tax authority has stated that using the incorrect PAYE reference number may lead to penalties and charges even if an employer has paid on time.

Online banking services may also default to a previous payment reference creating additional confusion and complications. Employers must check this is right every time they make a payment to HMRC. 

How to check if the payment reference number is correct?

Are you using the correct Accounts Office reference? You can find this on:

  • The letter HMRC sent when they first registered as an employer
  • The front of their payment booklet
  • The letter from HMRC that replaced the booklet
  • Their Business Tax Account if they’ve already added Employer PAYE enrolment to it.

As an employer, where you are not paying for the current period, you need to add four additional characters to the end of the reference number indicating the payment year and month. 

Each tax period has a different payment reference number, so you must make separate payments in each period. 

Ensuring you use the correct reference can be complicated. HMRC wants to make sure that employers get this right and avoid penalties and, therefore, encourage businesses to use its ‘Pay now’ tool on GOV.UK to find the correct reference number to use each time.

If this is a further admin burden you don’t need when trying to run a business, get in touch with us today to find out how we can take payroll headaches off your plate.


Link: Support from HMRC