As a favour, I have just assisted a friend who has a local business in dealing with his 2006/07 end of year PAYE procedures for his 10 employees.
His annual 2004/05 and 2005/06 P35s were actually submitted online by his accountant (not me) in order to get the online filing incentive. My friend sends his accountant a printout of his P11 details (from IRIS PAYE-Master) to enable him to complete an online P35. (Not the most efficient system, I know!)
It seems that my friend has received no notifications of changes in PAYE codes for his employees for the past year or so. As a result the wrong codes had been operated for most of his employees in 2006/07 and it is now too late to correct these. (In particular my friend failed to action last year's Budget increase in personal allowances.)
Phoning up the tax office today did result in the
correct codes being obtained for 2007/08 and these will now be operated, but it seems that most of my friend's employees will be due small tax refunds for 2006/07.
Is my friend's experience just an anomaly or might there be a large number of employers in a similar position?
Will the tax code changes have been notified to the employer electronically (in which case my friend, who is technophobic, will not have seen them)?
Do HMR&C not issue paper notifications to employers who file P35s electronically?
My friend contacted his accountant (who filed last year's P35) and he said he had not received any PAYE tax code change notifications from HMR&C.
How can my friend ensure that he receives notices of PAYE tax code changes for his employees in future?
Will each employee have to complete a tax return to get the small refund to which they are entitled?