Sage Cloud Payroll P32 Error

I've recently noticed a new line on my P32 called 'PAYE offset against NI Employment Allowance' - this is the 2nd line under PAYE values. After speaking to an advisor over the phone I've been informed that because I haven't submitted any EPS submissions to record the monthly PAYE liability Sage has automatically started to knock off some of the unused employment allowance against my PAYE liability.  This doesn't make any sense from a technical point of view as the employment allowance is only supposed to be deducted from employers NIC, so I can't understand why Sage would start deducting the employment allowance from the PAYE/Income tax? Surely this is 100% incorrect?

As an accountancy firm who have used (and still use) Sage 50 Cloud Payroll (desktop) for 200 employers the EPS submissions via Sage Business Cloud Payroll make no sense. An EPS isn't usually required unless you have amounts to offset against your liability? and the FPS is submitted to record the payment due. 

I think that the EPS rule on Sage Business Cloud Payroll could be made clearer to employers using it - espeically when they have moved over from Sage 50 Cloud payroll (desktop) where an EPS isn't required unless there is no payment due and/or CIS/maternity to reclaim. 

As a result of this problem, my revised amount due (bottom of the P32 page) is incorrect and has been for the last few months.

  • Hello,

    Thanks for using Sage City.

    Apologies for the delay in getting back to you. What my colleague has advised you is correct. In Sage Business Cloud Payroll the record payment eps option should be run through to close off the period and the EPS will only be sent if youre withholding say SMP/CIS from your payments to them. If you didn't claim the allowance and then are claiming it it will give you a reduction in your payment to HMRC by offsetting this against PAYE, instead of retrospectively going back and giving you unclaimed allowance for the employers NI which has already been paid in the previous period it gives you a reduction from the PAYE and this is why it shows on the p32. Hope this makes sense.

    Kind Regards

    Richard