Probably because the Document System has not been installed – see here
This is how to set up AW-APPS Payroll to calculate and record pension contributions for a deduction-at-source pension scheme such as that provided by NEST pensions (see www.nestpensions.org.uk) or The People’s Pension (see thepeoplespension.co.uk). With these schemes, the employee only contributes the net amount after tax relief. So where the basic contribution is 1%, the employee only has 0.8% deducted from gross pay, and the other 0.2% is claimed from HMRC by the pension scheme provider. Please note that this example does NOT apply to those schemes known as netpay schemes, which would require different settings in AW-APPS Payroll..
Example for tax year 2017-18:
Make sure you are using the latest version of AW-APPS Payroll
Employee earns £325 per week, weekly paid
Pension contributions calculated as a percentage of Qualifying Earnings as defined at tpr.gov.uk
Employee percentage 1%
Employer percentage 1%
Settings in AW-APPS are:
AE_enrolled = Y
AE_netpayScheme = N
AE_enable_autocalc = Y
AE_useQE = Y
Next payday tab:
AE_percentage = 1
AE_percentage_employer = 1
These settings will produce the following deductions on the Next payday tab:
PENSION_other = 1.70
PENSION_contrib_employer = 2.12
Employee (325-113) x .01 x 0.8 = 1.70
Employer (325-113) x .01 = 2.12
Note: The employee contribution is net of the 20% tax relief as required.
If you are using NEST pensions and are completing a Contribution Schedule on the NEST website, show the qualifying earnings only (325-113 = 212 in the Earnings box and also check the Auto-calc check-box. The current qualifying earnings deductions are shown on the Tax NI tab as AE_thresh1_wk and AE_thresh1_mn in AW-APPS Payroll.
The 2017-18 values are £113 for weekly paid and £490 for monthly paid.
The use of Qualifying Earnings is the minimum requirement. Some employers choose to base pension contributions on gross earnings without deduction (AE_useQE = N). Please check your scheme rules. In this case you would enter the gross pay in the Earnings box on the NEST website.
Step 1: Change the setting Employment_Allowance on the Company tab to Y, if applicable.
Step 2: Submit an EPS using the Actions, RTI-general menu.
This will notify HMRC that Employment Allowance is claimed, and will deduct the relevant amounts from the HMRC payment indicated by the Tax-payable process when it is next used.
Sometimes a submission sent from AW-APPS Payroll to the HMRC RTI system does not receive a response after a set number of attempts. This can happen when HMRC systems develop technical problems. In this situation, AW-APPS reports that polling has expired and does not commit the payroll. It has to be run again later from the Run tab. HMRC is aware of these issues as soon as they arise and fixes them as soon as it can, so it is usually just a case of trying to run the payroll again after an hour or so.
On the NextPayday tab, select one of the lines OtherPay_1_Text, OtherPay_2_Text etc. and change its setting to the required wording, for example Sales Bonus.
Move down the screen to the line OtherPay_1 and the new text will be visible on the right. Enter the required amount of the new payment and continue as normal.
When the payslip is produced during the next payroll run, it will now show Sales Bonus for this item.
To review all such customised categories used for an employee during the year, go to Reports, Employee.
For deductions from pay, use the corresponding deduction lines.
These customised values can be changed each week or month, so it is possible to have six different unique payment categories each week giving 312 separate unique categories a year for weekly paid employees and 72 for monthly paid employees. Similarly for deductions.
Alternatively, just leave a chosen text wording in place and it will be available every pay period.
Sometimes it may be required to pay more than one week or month at a time to an employee in a single wage payment. Go to the NextPayday tab and first make sure that the periodnumber setting is correct for the payment now being made. For weekly paid employees, this is the tax week containing the date of the payment. For monthly paid employees it is the tax month containing the date of the payment. Next change the PeriodsNowPaying setting from 1 to the correct number of weeks or months for which the payment relates. When these settings are correct, proceed as normal entering the total payment values for the whole period being paid. Calculations will now be made allowing for the extended period and payslips will show the quantity of weeks or months being paid. The PeriodsNowPaying setting will be reset to 1 after Commit is pressed, so that the following week or month will be processed as a single period unless the same steps above are followed. Just make sure that after Commit is pressed, the new periodnumber setting corresponds with the next expected payment week or month number for that employee. If not, change it to the correct number.
An EPS is an extra submission which is used to notify HMRC of special factors affecting the amounts of PAYE/NI that it is due to receive each month.
HMRC knows the amount of PAYE/NIC that should normally be paid to it using the details included in the regular payroll submission, termed a Full Payment Submission (FPS). The FPS is sent automatically by the software every time a payroll run is committed.
Items which are not included in the normal FPS submission, and for which an EPS is therefore required, include
- Statutory Payments made for sickness or parental leave, including details of the amount reclaimed and the compensation due
- CIS deductions suffered by the company for which offset relief is claimed
- NI Holiday amounts to which the company is entitled
The figures in an EPS are all given for the year-to-date.
Each company on the system has a setting on the Company tab which shows when an EPS needs to be submitted to HMRC. This setting is changed automatically by the software between Y and N.
There is actually no need to check the setting because you will be advised that an EPS is needed when using the Tax Payable menu. If this advice is given, submit the EPS by first checking that the correct company is showing in the Company Selector – top left – and then selecting Actions > RTI – General > EPS.
An EPS submission is only required when the relevant year-to-date figures change (see previous FAQ question). Accordingly the software will not advise that an EPS is due if there has been no change to the relevant year-to-date figures. An exception is claiming Employment Allowance (see other FAQ topic).
If an EPS submission is not submitted when indicated by the software, HMRC will appear to have received an under-payment and will take steps to collect the full amount included in the normal payroll submissions.
To ensure that HMRC gives credit for off-setting EPS items, the EPS must be submitted by the 19th day of the month containing the tax-month end. For example, when paying the tax for the tax-month from 6th October to 5th November, the EPS must be submitted by 19th November, which is also the due date for the associated tax payment.
If the EPS is submitted late (after 19th), then HMRC will require full payment for the month to the 5th, and will only allow the reduction against the following month’s payment.
End of Tax Year Declaration to HMRC
An special EPS is also used to make the End of Tax Year Final Submission Declaration HMRC.
Please see the separate FAQ item for this.
At the end of the tax year, which is 5th April, an End of Tax Year Final Submission Declaration needs to be made to HMRC by each employer. This declaration should be made for each company on the system using the Actions menu by selecting RTI-general, then End of Tax Year final submission to HMRC [by EPS].
You will be required to answer the questions that previously appeared on the P35 end of year return, which is no longer used under the RTI system. When the correct responses have been selected and if all the conditions listed on the panel are correct, press the Submit button to send the EPS.
For each Company, the End of Tax Year Final Submission Declaration needs to be made:
- after the last payroll has been processed for the tax year
- after any normal EPS submissions or Inactivity notifications have been made for the year
- before May 20th following the end of the tax year to avoid penalties.