PAYE Schemes & Holiday

Norvydas

Hi guys, just a quick question as I am bit confused here. Lets say there was a sole trader who was already operating PAYE scheme (had about 10 employees). The sole trader opened LTD company, HMRC have requested for the sole trader to open a new PAYE scheme for LTD company and cease the sole traders PAYE scheme.
New PAYE scheme have been opened, new employment contracts have been issued, all employees have been moved to new PAYE scheme, started fresh employment with LTD company.
The payroll bureau have simply carried forward all of the holiday pay that employees had accrued while they were on sole traders PAYE scheme to LTD PAYE scheme.

Two questions;

1) Can you do this? Can you roll forward holiday pay when moving from sole trader to LTD and operating under different PAYE schemes?
2) How can I now show in the accounts that holiday pay have been paid? Well for example £100 have been carried forward from sole traders PAYE scheme, therefore this is a liability of a sole trader and not a LTD as LTD is a separate entity? But on the LTD’s payslips to the employees it shows that that’s what’s owing to them from LTD company...

Any help would be appreciated.

MarieNoelle

Hi @Norvydas

The transfer may well fall under the TUPE regulations - here is a link to the ACAS website for more detail.

Please also look at the HMRC guidance re: payroll.

Norvydas

MarieNoelle said:

Hi @Norvydas

The transfer may well fall under the TUPE regulations - here is a link to the ACAS website for more detail.

Please also look at the HMRC guidance re: payroll.

Thank you very much for this!! It has answered a lot of questions!!

Thanks again!