Pegasus Payroll Upgrade 2009 – Important Information

Pegasus is required to maintain all of its Payroll solutions in order to remain compliant with HM Revenue & Customs (HMRC) legislation. Phase One of the project will incorporate the necessary legislative changes required to complete the 2008/2009 Tax Year and process from April 2009 onwards. Phase Two will cover any legislative changes resulting from the Budget that are normally implemented in May.

• National Insurance Upper Accrual Point (UAP) – Opera II, Opera for Windows & Capital Gold Payroll. The Upper Accrual Point (UAP) is a new National Insurance threshold between the current Earnings Threshold and the Upper Earnings Limit threshold, effective from April 2009 onwards. This has been introduced as part of the pension reform provisions of the 2007 Pension Act. The state second pension (S2P) is being restructured to become a flat-rate pension by around the year 2030. Currently S2P benefits are accrued based on the level of an employee's earnings between the National Insurance Lower Earnings Limit and the Upper Earning Limit. Various processing and calculation areas of the software, along with the recording and reporting of National Insurance, will all need to be changed to accommodate the new UAP

• Internet Service for PAYE -Online Filing Manager. The format and validation requirements for the Online Filing Manager XML message will require some minor changes

• P14/P60 -Opera II, Opera for Windows & Capital Gold Payroll. The layout/design of these forms has not changed for the year end 2008/2009. However, new stationery will be required displaying the appropriate Tax Year

• P35 (Employer Annual Return) - Opera II & Capital Gold Payroll. The layout/design of the P35 End of Year Return for the 2008/2009 Income Tax Year has not changed therefore there are no software changes required

• Year End Returns on Disk - Opera II, Opera for Windows & Capital Gold Payroll. This year, the format/content of the file has not changed

• PAYE End of Year Wizard - Online Filing Manager. During Step 3 (Additional Information), the maximum value allowed in Box 26 (tax-free incentive payment) has increased from £650 to £750

• P45 Form changes - Opera II, Opera for Windows & Capital Gold Payroll. HMRC has changed the design of the P45 form. The new portrait design includes boxes for gender and date of birth, additional information that the employer must now provide, and changes to existing field formats. From 6 April 2009, all employers must use the new P45 design however the new design may be used before 6 April 2009. HMRC has also introduced a new plain paper form for employers to give to their employee if they have submitted their P45(1) online. From 6 April 2009, all employers with 50 or more employees must submit P45 (1) and P45 (3) forms to HMRC online and paper returns will not be accepted.

• New P46 (Expat) Return - Opera II. From 6 April 2009, if an employee who works for an overseas employer is seconded to work in the United Kingdom, form P46 (Expat) must be submitted to HMRC when they start work. Changes have been made affecting the Payroll > Processing > To-Date form and a new report has been added to Payroll > Periodical Reports

• Digital Receipts (In-Year Online submissions) - Online Filing Manager
  From 6 April 2009, software products that submit in-year returns online must be able to receive digital receipts (electronic responses) from HMRC. The digital receipt, or HMRCMark, verifies that a submission has been accepted and validated by HMRC, and includes a unique HMRCMark identification code and information regarding the communication sent

• Discontinued HMRC form SSP1 (L) - Opera II & Capital Gold Payroll
  HMRC has discontinued the use of the SSP1 (L) form. The form was used to link periods of Incapacity for Work (PIW) where the employee was ill after starting work for a new employer and had been paid SSP by their previous employer within the 56 day linking period for SSP. The previous employer was required to issue form SSP1 (L) if the employee asked for the form

• New P46 (Pen) Return - Opera II & Capital Gold Payroll
  From 6 April 2009, the P160 form or PENNOT online submission will be replaced by the P46 (Pen). These forms are currently used by pension providers and employers that run their own pension or annuity schemes to inform HMRC when someone starts their retirement. Employers with 50 or more employees must now submit a P46 (Pen) online, where, prior to 6 April 2009, they submitted P160 forms on paper or PENNOT returns online. HMRC expect that employers with fewer than 50 employees will have to submit the P46 (Pen) online from 6 April 2011 HMRC Payroll Standard and HMRC Pensioner Payroll Standard

• P46 (Pen) Return - Opera II & Capital Gold Payroll
  To comply with the HMRC Pensioner Payroll Standard, software products must be able to submit the P46 (Pen) form (currently referred to as the PENNOT) online. See information in the Statutory Changes for 2009 section above for full details

• Automated Statutory Adoption Pay (SAP) & Statutory Paternity Pay for Adoption (SPP - Adopt) - Opera II
  To comply with the HMRC Payroll Standard, software products must be able to calculate Statutory Adoption Pay (SAP) and Statutory Paternity Pay for Adoption (SPP - Adopt). This is in addition to the existing mandatory elements of Statutory Maternity Pay (SMP) and Statutory Paternity Pay for New Births (SPP - Birth).

For more information on legislation, please refer to: www.hmrc.gov.uk

New for 2009

In addition to the statutory changes outlined above, the upgrades will include some enhancements and new functionality. This information will be available shortly within this section of our web site.