P32 payments and employer payment summary (EPS) submissions

Your regular FPS submissions after each pay run generally provide HM Revenue & Customs (HMRC) with the information they need to confirm throughout the year that each employee’s tax and national insurance (NI) liabilities are being deducted correctly. It also determines the amount you owe HMRC at the end of each tax reporting period. The payment due to HMRC for this liability is known as a P32 payment.

You would normally submit an employer payment summary (EPS) when you recover statutory payments, which reduces your liability and the amount you owe HMRC. It includes supplementary information about your company’s tax and NI liability, such as employment allowance and small employers’ relief. You can also enter any values external to your payroll that reduce your liability to HMRC, such as Construction Industry Scheme (CIS) deductions suffered.

P32 tax reporting periods

Your tax reporting period is normally each tax month, and runs from the 6th of one calendar month to the 5th of the next calendar month. For example, tax month 7 runs from 6 October to 5 November. Download a copy of the 2015/2016 tax calendar.

Some employers can ask HMRC for their reporting period to be each tax quarter and to make their liability payments every quarter, instead of every month. For example, tax months 1 to 3 would be the first reporting period, tax months 4-6 would be the second, and so on.

It’s not possible to change your frequency in Sage One once you start to process pay for the current tax year.

You can check whether you’re set up for monthly or quarterly in:

  • Settings > Payroll Settings > Payroll Settings > HMRC Reporting Frequency.

The P32 Employer Payment Record report

We recommend that you view or print the P32 Employer Payment Record report at the end of each tax reporting period. This report shows a breakdown of your total liability due to HMRC for the period. You can use the values to help you determine whether or not you need to submit an EPS.

To record your P32 payment details and submit an EPS

Once you complete a reporting period, you should record your P32 payment details and if due submit an EPS.

You would normally submit an EPS for the first tax reporting period, and then each reporting period if you’re recovering statutory payments. An EPS may not be required, if you’re not recovering statutory payments or CIS deductions in the current tax period.

The payment is not automatically sent through Sage One, so you still need to pay HMRC. You must pay HMRC the amount due by the 22nd of the following month, if by bank transfer or the 19th if you’re paying by cheque.

  • 1. Complete every pay run in the tax reporting period.
  • 2. Summary tab > HMRC Real Time Information (RTI) Scheme panel > check the current EPS status.

When you complete all the pay runs in the current tax reporting period, this shows how long you’ve got to make your EPS submission, or whether it’s overdue.

If the Record Payment / EPS option doesn’t appear, either not all pay runs are complete for the reporting period, or all FPS submissions relating to these pay runs have not been successful.

  • 3. Record Payment / EPS > enter the required details for your P32 payment:
Eligible for small employer’s relief To claim small employers’ relief, choose Yes.

  • You qualify for this relief if you paid or were liable to pay, total gross Class 1 NICs, excluding Class 1A and Class 1B, of £45,000 or less in the qualifying year.
Eligible for NI Employment Allowance To claim the NI employment allowance, choose Yes.

  • Most employers are entitled to a £2,000 NI employment allowance and is offset against your employer NI contributions.
  • If you qualify for the allowance, you must specify this when you record the P32 payment details, each tax reporting period.
Tax and NI due to HMRC The total amount of tax and NI currently owed to HMRC.
Record amount paid to HMRC This is the total amount of tax and NI you’re actually paying to HMRC in this payment.

  • For a breakdown of the Amount Due value, refer to the P32 Employer Payment Record.
  • Do not include any statutory payment funding advanced to you.
Payment date The date of your payment to HMRC.
Ref/Cheque number The reference or cheque number associated with the payment, if applicable.
  • 4. Next > confirm the balances are correct:
Amount of CIS Deductions suffered If you’re a limited company and have had Construction Industry Scheme deductions taken from payments you received during the year for work in the construction industry, enter the total CIS deduction amount up to and including the current pay run.

  • The year to date amount up to the previous pay run also appears.
  • You can get this value from column E of Form CIS132.
  • The value reduces your overall tax liability. However, the Sage One Payroll does not do this automatically. You need to manually deduct the amount from your liability.
Total Recovery & Compensation for Statutory Payments If you pay statutory payments to employees, this window shows the year to date value of these payments recovered from HMRC, up to and including the current pay run.

  • The balance up to the previous pay run also appears.
  • This is calculated automatically and includes recovery of any:

    * Statutory maternity pay (SMP)
    * Shared parental pay (ShPP)
    * Statutory adoption pay (SAP)
    * Ordinary statutory paternity pay (OSPP)
    * Additional statutory paternity pay (ASPP)
  • 5. Click Next.
  • 6. If No EPS Required shows, check the P32 payment value.
  • 8. Click Submit.

Once a submission is complete you should check the status is successful in Summary tab > HMRC Real Time Information (RTI) Scheme panel. If a submission fails, to find out what to do to resolve the problem, click Resolve Issue.

You can now make your actual payment as normal to HMRC.

If you’ve signed up to a Sage One accounts service, as well as Sage One Payroll, totals are posted to your accounts service at the end of a tax reporting period. You can check what’s been posted by looking at the salary journals.

To help you with any queries you may have, we’ve also put together a list of common questions.

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