DMBM520555 - Debt and return pursuit: PAYE: in-year process: quantification: overview

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Apart from using a P100 or P101, quantification is also a way of establishing the debt and is used to work out amounts due where an employer or contractor has failed to pay PAYE, NIC, ITSC or Student Loan Deductions.

Quantifications can be required in the following situations

  • two or more P101 (specified amounts) have been paid without correct confirmation of figures
  • at the request of a customer
  • on a distraint visit when a customer declares that they haven’t received the P101 form. An officer can do an on the spot check of the wages records and then quantify the amount due, filling in a quantification letter and giving the customer seven days in which to pay
  • the P35/P14 is outstanding and the final figures are not known
  • the employer/contractor has failed to respond to the issue of a P100.

Employers/Contractors get a written warning of a pending quantification and on receipt of the warning, they must either

  • pay the amount due
  • bring their records in to HMRC (or at a place we specify for example their agent’s address) for us to quantify the amount due
  • suggest an alternative date, time and venue for us to agree that we will call and quantify.

Note: Quantifications must be done in person, either at the business premises, HMRC offices, a HMRC nominated place for example their agent’s address or at a mutually agreed location, for example their business premises. They must never be done over the phone, as the officer of HMRC has to certify that they have verified the amounts due and seen the figures.

As you may be working at the employer's premises, possibly with the employer watching over your shoulder. You must

  • perform your duties in the correct sequence
  • accurately quantify from the wages records.

If the employer’s records are on a computer, you should accept the data in the employer’s preferred format and ensure that they supply you with the means to read it.

It should not be necessary for you to make any checks on the employer's records, such as checking that the deductions are correct according to the tax/NIC tables, unless you have reason to doubt their accuracy.

Legislation

Paragraph 1 of Schedule 36 to the Finance Act 2008 allows “an officer of Revenue & Customs to obtain information and documents from employers by making a written request to the employer. Documents/information can only be requested if they are reasonable required by the officer in order to check the employer’s PAYE position.”

Paragraph 39 of Schedule 36 to the Finance Act 2008 enables you to raise penalties if the information is not provided. For more information see DMBM570290.