The P32 Report details all payments owing and already paid to HMRC on a per month basis within a financial tax year.
This report can be accessed via the Payroll Settings > Reports > HMRC Reporting.
The report can be filtered on a per financial year basis. Please note that if a user attempts to generate this report whilst a pay run is unfinalised, the following warning message will appear:
When the report is generated, you will note the appearance of 4 tabs. The first tab displays all the relevant data in summary format:
An explanation of each header is as follows:
- Tax Month: The tax month runs from the 6th of the month to the 5th of the next month. For eg, with April, this covers all pay runs with a pay date from April 6th to May 5th.
- PAYE: All PAYE, excluding student loan amounts, deducted from employee pays for the pay runs falling within the Tax Month.
- Student Loans: All student loan amounts deducted from employee pays for the pay runs falling within the Tax Month.
- Net CIS Deductions: Construction Industry Scheme - CIS. This is the net tax deducted by the contractors from subcontractors' payments which is to be paid to HMRC
- Total PAYE: The sum of PAYE and Student Loans for the Tax Month.
- Employer NI: All employer national insurance contribution amounts calculated for the pay runs falling within the Tax Month.
- Employee NI: All employee national insurance contribution amounts deducted from employee pays for the pay runs falling within the Tax Month.
- NI Deductions: The total statutory payments relating to Maternity Pay, Paternity Pay, Adoption Pay and Shared Parental Pay processed in pay runs for the Tax Month. The second tab "NI Deductions Summary" details a breakdown of these payments.
- Employment Allowance: If the business is claiming an Employment Allowance, the amount will appear in this column. The allowance amount will be deducted (only from the Employer NI amount) up to a maximum £4000 for the tax year.
- Total NI: The sum of Employee NI + (Employer NI - NI Deductions - Emp Allowance).
- Apprenticeship Levy: The apprenticeship Levy is a tax that is payable from employers to HMRC to fund apprenticeship training. For more information on the apprenticeship levy please see this article.
- Advance Funding: Enter the amount you have paid manually here.
- HMRC Payments: Enter the total amount of payments you have actually paid to HMRC in this box to keep track of payments to HMRC.
- Total Due: The sum of Total PAYE and Total NI.
- Total Paid: Any payments made to HMRC can be recorded here. This is a manual entry and must be updated each time an amount is paid to HMRC. Instructions on how to do this are further below.
- Balance: The difference between Total Due and Total Paid. N.B. This amount is cumulative for the whole tax year.
- Payment Reminder - allows you to download or send a Payment Reminder of what needs to be sent to HMRC for that month or quarter depending on how you have set it up. For more information on the Payment Reminder please see this article.
The second tab breaks down the NI Deductions into each separate statutory component. Furthermore, the amounts are automatically classified within the Recovered and NIC compensation columns based on whether the business is eligible for small employers relief and has accordingly configured this in their HMRC settings, as follows:
If an employer is not eligible for small employers relief, 92% of the total NI Deduction amount is allocated to Recovered and £0 to NIC compensation.
If an employer is eligible for small employers relief, 100% of the total NI Deduction amount is allocated to Recovered and 3% is allocated to NIC compensation.
The 3rd tab deals with CIS deductions made and suffered. The Net CIS deductions are also displayed in the CIS tab of this report. You can view them in the tax month and also quarterly and for the financial year.
HMRC payments, Advance Funding and CIS payments can be recorded manually from the P32 report screen on the P32 tab and the CIS tab. To do this, click on the fields and fill in the values.
Configuring Employment Allowance and/or Small Employers Relief
Both of these settings are switched off by default. If, however, the business is eligible for either go to Payroll Settings > HMRC Settings. From this screen you will see the following settings:
Click on the appropriate "Yes" radio button and then click on 'Save'.
If you choose 'Yes' under claiming the Employment Allowance you will see the following
If you have claimed employment allowance in another payroll product in this tax year when you click on the pencil icon you will have the ability to enter the amount claimed in the previous payroll period which will then be displayed in April under the Emp Allowance column on the P32.
Any unused amounts can be used for PAYE or any other balances owing to HMRC, but this isn't something that should be reflected on the P32 as it needs to be requested by arrangement with HRMC (as per the guidance here: https://www.gov.uk/claim-employment-allowance/when-to-claim)
The 4th tab deals with the Apprenticeship Levy, if this is applicable to you please click on the link above in the explanation of the headers in the P32 report.
This report can be exported to PDF and is also available via Report Packs.
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