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PAYE: Parish Councils

Treasury written question – answered on 3rd May 2011.

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Photo of Steve Brine Steve Brine Conservative, Winchester

To ask the Chancellor of the Exchequer what assessment his Department has made of the effect on parish council budgets of the recent guidance issued by HM Revenue and Customs requiring such councils to operate the pay as you earn system on income received by parish clerks for the purposes of (a) tax and (b) national insurance contributions.

Photo of David Gauke David Gauke The Exchequer Secretary

HMRC does not have an assessment of the effects on parish councils budget of operating pay as you earn (PAYE) scheme on payments made to parish clerks.

HMRC does recognise that employers, particularly small employers operating PAYE for the first time can find it daunting and offers significant help to all employers.

To help parish councils who need to operate PAYE for the first time HMRC set up a team of specialist advisers on the new employer helpline 08457 143 143 who have been specially briefed to deal with their queries.

HMRC also produces a free basic PAYE tool for small employers. It contains a calculator that works out the tax due and includes the forms that the parish council would need to run its payroll throughout the year and make annual returns. It will also allow the council to file any starter and leaver forms and its annual return online and this will help mitigate its costs.

HMRC also offers free workshops at many locations covering all payroll topics.

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