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PAYE settlement agreements: Can they help?

Shared from Tax Insider: PAYE settlement agreements: Can they help?
By Reshma Johar, September 2021

Reshma Johar looks at the potential advantages of PAYE settlement agreements for employers providing staff with certain benefits and expenses. 

A PAYE settlement agreement (PSA) is there to alleviate certain benefits and expenses from having to be declared on either an employee’s form P11D or self-assessment tax return.  

Employers will settle the tax and National Insurance contributions on behalf of employees, resulting in the employee receiving a benefit at zero cost. 

What’s in – and out 

There are three categories for qualifying benefits and expenses: 

  1. Minor: examples include incentive awards, small gifts and vouchers, staff entertainment such as a ticket to an event. Note that most

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