Security deposits for PAYE and CIS

Produced by a Tolley Employment Tax expert

Employment Tax

Guidance

When security deposits for PAYE and CIS are used

HMRC is able to ask employers for a security where there is a serious risk that they will not be able to pay over their PAYE and Class 1 National Insurance deductions to HMRC. The power is used by HMRC in high risk situations such as employers who:

•
deliberately choose not to pay
•
run up PAYE debts in their companies, close down their companies writing off the debt and then set up new ones to evade tax
•
build up large PAYE debts and penalties and do not respond to HMRC contact

ITEPA 2003, s 684(4B); SI 2003/2682, reg 97N

The security deposit regime also includes Construction Industry Scheme (CIS) deductions. For further details, see Simon’s Taxes E4.11140 and HMRC Securities Guidance Manual SG13000.

How security deposits work

HMRC require the security deposit in one of the following forms:

•
a cash deposit held by HMRC
•
paid into a joint taxpayer / HMRC account
•
a bond from an approved financial institution

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

Taxation of dividend income

Taxation of dividend incomeIntroductionA dividend is a distribution of profit by a company to its shareholders.A dividend is not only a payment in cash. It can be the issue of new shares in exchange for forfeiting the right to a cash payment (a stock dividend). For more detail, see the Cash

14 Jul 2020 13:48 | Produced by Tolley Read more

Tax Returns

Personal Tax

Timing of disposal for capital gains tax

Timing of disposal for capital gains taxDate of disposalThe date of the disposal determines the period in which the gain is subject to capital gains tax (CGT). When the rates of CGT change, the determination of the date of disposal can also affect the rate of CGT that applies to the gain.See the

14 Jul 2020 13:50 | Produced by Tolley Read more

Year-end tax planning

Class 1 v Class 1A

Class 1 v Class 1AClass 1 and Class 1AClass 1 and Class 1A are the categories of NIC that can be charged on expenses reimbursed and benefits provided to employees. These classes are mutually exclusive. A benefit cannot be subject to both Class 1 and Class 1A NIC. Three requirements must be met

��˾��ҹ��