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Posted Mon, 11 Oct 2021 08:08:22 GMT by Chris Wood
We have overpaid someone. We have realised the error and are in the process of recovering the payment from the individual but have not recovered it yet. Should we report the correct Pay and Tax to Date figures now (before we have recovered the payment)? Or is the correct process to wait until we have physically recovered the payment. There is a risk (small) we may not be able to recover the payment.
Posted Mon, 11 Oct 2021 11:04:40 GMT by HMRC Admin 10
Hi

With an overpayment of salary, you only need an agreement with the employee that they will pay back the net overpaid amount.

When you have an agreement, we then allow you to amend the payroll to state the correct salary.  

This will create a credit on your account with us for the tax and NIC and is how you get the full gross amount back.

We do not get involved with whether or not the employee pays the money back.  

This is a private matter between you and them.

Again, as long as you have an agreement, you can amend the payroll submissions.

Thankyou.

Regards.

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