Settling your PAYE liability to HMRC via Direct Debit

From September 2022 HMRC will allow you to set up a Direct Debit mandate to settle outstanding PAYE and NIC liability.

The changes made by HMRC, announced in the August 2022 issue of HMRC’s Employer Bulletin, will mean that after submitting your records to HMRC you now no longer have to set a reminder to transfer the payment.

A variable payment plan for PAYE and NIC liabilities was introduced on 19 September 2022. The current system allows only a single payment to be made by direct debit. The Direct Debit payment will be taken on the 23^rd of the month, with a notification 3 days prior to advising the value of the payment.

There are no changes to the rules around the submission of information. If you want to make use of this, details can be found in HMRC’s Employer Bulletin. There will be no additional interest charged to employers who choose to pay by variable direct debit payment plan, provided that their direct debit payment completes correctly.

If you have your payroll or submission completed by an agent it is good to remember that they cannot set up direct debits on behalf of clients, banking rules require direct debits to be set up by an account signatory.

As this is a new service, it would be advisable to verify values and payments taken after signing up.