Time running out for agreeing PSAs

01 July 2010

A PAYE settlement agreement (PSA) can be used where the employer wishes to meet the tax liability associated with providing a benefit or expense to an employe. The employee pays the tax and Class 1B National Insurance contributions on items included within the agreement. The employee is relieved on any tax liability and the employer does not need to report the benefit on the employee's P11D.

PSAs for 2009/10 must be agreed with HMRC by 5 July 2010.

Remember to check the tax calendar to ensure that key deadlines are not missed.