Recent processing delays at HMRC mean employers must allow more time to set up new direct debits for PAYE.
According to the Institute of Chartered Accountants in England and Wales (ICAEW), employers will now need to set up any new variable direct debits at least nine working days before the payment date.
HMRC's current guidance says employers only need to allow six working days. However, HMRC will need extra time to process applications from 22 March 2023 onwards.
This means employers must set up any direct debits due for collection on 22 March by 10 March. Meanwhile, the submission deadline for employers with monies due on or after 22 April will be 12 April.
The ICAEW criticised these delays and highlighted further ongoing issues with the service.
Currently, employers receive a late payment interest charge on their accounts if HMRC processes payments after the usual due date. HMRC later reverses this, so long as the direct debit is collected the first time.
HMRC also issues a generic notification service late payment notification to tell employers they have not paid - even when they have.
As such, the ICAEW has requested an update on how HMRC plans to stop these automated processes.
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