I’ve had worried feedback from several retailers following my piece in the last issue about ex-retailer John Raisen who warned that the Inland Revenue had wanted £89,000 (eventually reduced to £10,000) off him for possible taxes on previous employees he had on his books but had not registered via the P46 form. Like many, John supposed you didn’t need a P46 for employees falling below the tax threshold. Once he decided to retire, the IR decided to give him a good going over to see what extra taxes they could get.

John Troop, who runs Station Road PO, was one concerned retailer who wanted to know how you go about getting the P46. And Raj Patel emailed to ask what about those employees who don’t want their details given or who have already left your employ and are reluctant to provide details. Yet another rang to say that the IR had de-registered him a few years back because he kept submitting blank returns, all his employees being below the threshold. Where did he stand?

To get the P46 form you merely contact the IR. The tax people like to know who is working for whom (and how many jobs they may have). When a new employee joins you, they should come with a P45. If they don’t have one, then you should apply for a P46 form before their first pay day. If the employee is below the threshold for NI contributions then you should hang onto the form. If they are above it, then you should submit it. You can download the form from www.inlandrevenue.gov.uk which will direct you to its new site (whose name is far too long for me to remember).

If you have any query about any of this, the IR runs an employer advice line on 08457 143143. It did take me 17 attempts to get through even to the recorded message so it’s obviously a very ‘popular’ line. The bloke I spoke to eventually admitted it was a very busy line and that “something was being done about it”.

He confirmed the very best advice I could give any retailer was: if no P45, then get a P46 before their first payday. If you don’t and you are investigated, then the IR will charge you the basic rate of 22% on all earnings regardless of the level of earnings. It would be wise to act now. The penalties don’t go away and they may get worse. Each case is assessed on its own merit and you really should ring the helpline on the above listed number. I know it’s an 0845 number but you will get a busy signal if no one is available to take your call.

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