Form P45 as we know it, that details pay and tax of a leaving employee, is to remain because employers wanted to keep them.
The form had been set to be replaced by a “leaver statement” as part of the PAYE Real Time Information (RTI) plans during 2013-15. The Chartered Institute of Taxation had asked HMRC back in November to withhold any changes until employers became acquainted with RTI but the Revenue went one better and actually acted upon its 'customers' wishes.
HMRC's decision to back down from replacing form P45 is a sensible one as introducing a new form this year may have caused confusion for both employers and employees alike.
Under RTI, employers will submit PAYE data electronically to HMRC, including employees leaving and joining. The system is to be trialled in April of this year.
Leave a Reply