Details of the Schedule
2.Paragraph (1) provides that section 684 of the Income Tax (Earnings and Pensions Act 2003 (ITEPA) is amended. Section 684 of ITEPA allows the Commissioners for HMRC to make regulations for the assessment, collection and recovery of tax under PAYE.
3.Paragraph (3) amends section 684 of ITEPA to allow the Commissioners to make regulations for deductions in respect of specified relevant debts, the circumstances in which deductions may be made and the time that any deductions are treated as paid.
4.Paragraph (4) provides that no more than £2,000 may be deducted in any year without the employee’s consent. This amount may be changed by Treasury order.
5.Paragraph (6) provides that section 684 of ITEPA is amended to insert new subsections (7AA) and (7AB). New subsection (7AA) defines a relevant debt as a sum payable under or by virtue of an enactment other than an excluded debt, or one payable under a contract settlement. “Under or by virtue of an enactment” brings in those debts arising from taxes, duties etc imposed by statute. “Contract settlements” are contractual agreements made in connection with a person’s liability, usually as the result of an enquiry covering a number of years.
6.New subsection (7AB) defines terms and expressions used in new subsection (7AA). The definition of “excluded debts” preserves the Commissioners’ existing powers to make regulation for the collection of income tax or capital gains tax through PAYE in section 684 of ITEPA and for the collection of tax credits through PAYE in section 29(5) of the Tax Credits Act 2002.
7.Paragraph 10 allows the necessary consequential changes to ITEPA and other enactments to be made by Treasury order.
