Aug 2013
9
Something to watch out for if you run a four weekly payroll although it may not happen for another 20 years !
A “quirk” in the tax system that occurs once every 20 years has resulted in Asda staff owing more than £12m in outstanding tax to HMRC.
The supermarket’s 170,000 employees were affected by the payroll anomaly that occurs for companies with four-weekly payroll systems, where 14 payments are made in a tax year rather than the usual 13. Most of the employees were paid 14 times between 6th April 2012 and 5th April 2013 – the 2012/13 tax year – rather than the usual 13 times.
The payroll provider, said: “This is an anomaly within HMRC and there is no means of getting round it by payroll providers.”
Following the incident HMRC posted advice on its website on “dealing with ‘week 53’ payments”. When completing a Full Payment Submission it says: “Do not change the final tax code to week 1 if the only reason you have used week 1 is to calculate a payment on week 53."
