PAYE healthcheck – scope

A review can include:

• •a review of the employer’s PAYE / NIC benefit and expenses procedures
• •interviews with the relevant members of staff and completion of a questionnaire
• •review of internal documentation and correspondence
• •examination of a representative sample of the employer’s records
• •preparation of feedback, identifying any areas of non-compliance – see the PAYE healthcheck – outcomes guidance note
• •practical recommendations

The employer may have an idea of what he wants reviewed and may therefore limit the review to a particular area of risk, such as status of workers, termination payments or provided accommodation.

The scope of the review therefore depends on what areas it is designed to cover and the depth required.

Although the nature of the work being carried out might be the same, the scale of the work and depth of any review will differ depending on the organisation.

It is advisable that any work must be agreed in detail between the organisation and any external specialist and business terms or an engagement letter agreed so that there can be no doubt as to the work being undertaken, the depth of the review and the protection the organisation can expect.

In determining the scope of the review it is important to consider:

• •budgetary constraints
• •materiality – ie the importance / significance of an amount, transaction, or discrepancy
• •timescale
• •size of organization
• •area risk
• •disclosure requirements

It is important therefore to ensure the employer understands