Tx notes fa22 Final

9.5. Changes to coding 
An employer must use the last code notified to him for existing employees until new written 
instructions are sent from HMRC.
9.6. Year end returns 
The employer must send to HMRC the following:
By 6 July:
๏
P11D
Benefits for directors and employees earning in excess of £8,500 for the year
๏
P9D
Benefits of other employees. 
The employer must give to the employee
By 31 May:
๏
P60
Permanent record of pay and tax deducted as well as NIC’s made in the tax year.
By 6 July:
๏
P11D
Benefits for directors and employees earning in excess of £8,500 for the year
๏
P9D
Benefits of other employees. 
9.7. Employees leaving or joining 
(a)
Employees leaving
The employer should complete form P45 and send part 1 to Tax O
ffi
ce and give parts 2, 3 and 
4 to the employee.
(b)
Employees joining
i.
When an employee joins and has a P45 the employer can operate PAYE
ii.
The employer uses the tax code on the P45 if it relates to the current year; otherwise he 
uses the emergency code.
iii.
If the employee does not have a P45, the new employee must complete form P46.
Students should now attempt Practice Question 16



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Chapter 10
PENSION SCHEMES 
1. Types of Pension Scheme 
There are tax advantages associated with pension scheme investments. A registered pension 
scheme is a long-term savings plan for retirement with special tax privileges.
๏
the individuals who invest are entitled to tax relief for the contributions they make into the 
scheme limited to the higher of:
‣
the relevant earnings of the taxpayer, being mainly employment income and/or trading 
profits plus any profits from furnished holiday lettings, or
‣
£3,600 of gross contribution
๏
An employer who contributes into an employees fund can deduct those contributions from their 
trading profits. These contributions are an exempt benefit for the employees. 
This amount will also contribute towards the annual allowance permitted each year.