P45 stay of execution welcomed
30 March 2012
The P45 certificate, issued when workers move jobs, will not be phased out, according to HM Revenue & Customs (HMRC), a move welcomed by suppliers of financial services to the recruitment industry.
Weds, 8 Feb 2012
The P45 certificate, issued when workers move jobs, will not be phased out, according to HM Revenue & Customs (HMRC), a move welcomed by suppliers of financial services to the recruitment industry.
HMRC had planned to replace the P45 with a leavers certificate for those employers signed up to its Real Time Information (RTI) programme providing information for Pay As You Earn (PAYE) schemes.HMRC says it will retain the P45 for all employees following consultation and a workshop with employers and representative groups.
The move has been welcomed by Jonathan Margrave, managing director of contractor payment firm the cps group, saying “certainly from an ease of use point of view it’s a sensible decision to not enforce the change”, also noting that within five years, RTI will be used by all employers, but saying that it is always best to drive through such changes more gradually.
Margrave adds that with the term P45 having become part of the vernacular, this would have been a major change to the way in which payment was handled, and calls the cancellation of its abolition “a good move all round”.
Sharon Wiltshire, managing director at Bibby Financial Services, agrees that: “It is a positive thing to see that the HMRC has consulted, listened to the industry and followed the recommendations of the recruitment sector.
“The lack of awareness and education around a new system would have inevitably led to mistakes being made and again, costs incurred to businesses.”
She adds that “introducing something new would really have been change for change’s sake”.
The P45 certificate, issued when workers move jobs, will not be phased out, according to HM Revenue & Customs (HMRC), a move welcomed by suppliers of financial services to the recruitment industry.
HMRC had planned to replace the P45 with a leavers certificate for those employers signed up to its Real Time Information (RTI) programme providing information for Pay As You Earn (PAYE) schemes.HMRC says it will retain the P45 for all employees following consultation and a workshop with employers and representative groups.
The move has been welcomed by Jonathan Margrave, managing director of contractor payment firm the cps group, saying “certainly from an ease of use point of view it’s a sensible decision to not enforce the change”, also noting that within five years, RTI will be used by all employers, but saying that it is always best to drive through such changes more gradually.
Margrave adds that with the term P45 having become part of the vernacular, this would have been a major change to the way in which payment was handled, and calls the cancellation of its abolition “a good move all round”.
Sharon Wiltshire, managing director at Bibby Financial Services, agrees that: “It is a positive thing to see that the HMRC has consulted, listened to the industry and followed the recommendations of the recruitment sector.
“The lack of awareness and education around a new system would have inevitably led to mistakes being made and again, costs incurred to businesses.”
She adds that “introducing something new would really have been change for change’s sake”.
