IRP 501, employees tax reconciliation

[duncan drennan]

I recently received my first IRP 501, "Reconciliation of tax deductions and certificates."

Looks like I need an IRP5 book (which thankfully my accountant has organised), and then I need to reconcile the tax paid to the amounts on the IRP5 certificates (which will be issued). Also seems that I have to declare the numbers of the IRP5 certificates issued.

Seems relatively straight forward....anyone want to walk me through what needs to be done? Or possibly point out anything which can be an issue?

[Dave A]

The IRP 501 is no big deal. Just make sure the totals for payments made add up to the total tax deducted as per the issued IRP5's.

IRP5's are a much bigger pain. No alterations allowed for starters
For me the biggest pain is identifying the correct remuneration code for each type of income and deduction code for each type of allowable deduction for the IRP 5. And remembering to seperate SITE from PAYE.

Probably the only other point that springs to mind is that employees that are subject to SITE only (no PAYE element) need to be finally assessed by you, the employer, to make sure that total SITE deducted during the year is correct against the total taxable annual remuneration.