PAYE proposals would increase red tape

Government plans to change PAYE reporting requirements will mean more bureaucracy and cost for farmers and other employers.

Under the proposals, details of employees’ pay and PAYE deductions to HM Revenue and Customs would have to be submitted each time a wages payment is made, rather than the current annual report at the end of the tax year.

“One significant issue may be that HMRC is proposing that details of pay and PAYE deductions will need to be sent to them through the BACS system. That suggests that they believe most employees are either already paid through the BACS system or will be at some point in the future,” said the NFU.

The union is surveying members on their use of banks, including the extent to which they already make BACS payments and whether there are technical or financial issues which prevent its wider use.

HMRC says that receiving more regular information will lead to greater accuracy within the PAYE system. It will also allow real-time information on pay to be provided to the Department of Work and Pensions, which will in turn help the DWP to calculate entitlements to the new Universal Credit.