How to Submit an Employer Payment Summary (EPS) to HMRC

Team Nomi

Jul 18, 2024
9 minutes read

EPS stands for Employer Payment Summary. It is a form that employers use to report to HMRC about the payments that have been made to employees and any deductions, such as Income Tax and National Insurance contributions, that have been taken from their wages.

The EPS is part of the Real Time Information (RTI) system, which requires employers to submit information to HMRC every time they pay their employees, rather than just at the end of the tax year. This helps ensure that employees’ tax and National Insurance contributions are up to date.

This blog post will guide you through the process of submitting an EPS to HMRC, covering everything from what an EPS is and when to submit it, to the key information you need to include and common errors to avoid. We’ll also explore how payroll software can simplify this process, making it easier for businesses of all sizes to stay compliant.

By the end of this guide, you will have a clear understanding of EPS submissions and feel confident in managing this important aspect of your payroll responsibilities.

What is an Employer Payment Summary (EPS)?

An Employer Payment Summary (EPS) is a report that employers submit to HMRC to provide details about their payroll. It’s used when you need to inform HMRC about specific situations, such as:

• No employees were paid in a tax month
• You’re claiming Employment Allowance
• You’re recovering statutory payments (like maternity or paternity pay)
• You’re adjusting the amount of Class 1 National Insurance contributions

Essentially, an EPS helps you communicate important payroll information to HMRC that isn’t covered in your regular Full Payment Submission (FPS).

When and Why to Submit an EPS?

Knowing when and why to submit an Employer Payment Summary (EPS) is crucial for maintaining compliance with HMRC regulations. Let’s break this down into simple terms:

When to Submit an EPS:

1. No PAYE payment due: If you haven’t paid any employees in a specific tax month, you need to submit an EPS to inform HMRC.
2. Reclaiming statutory payments: When you’ve made statutory payments (like maternity or paternity pay) and want to recover them from HMRC.
3. CIS deductions: If you’re a contractor in the Construction Industry Scheme (CIS) and need to offset deductions suffered against your PAYE liability.
4. NIC holiday: When you’re claiming Employment Allowance or other NIC-related reductions.
5. Apprenticeship Levy adjustments: If you need to report changes to your Apprenticeship Levy contributions.
6. Correcting earlier submissions: Use an EPS to amend any errors in previous submissions.

Why Submit an EPS:

1. Avoid unnecessary penalties: HMRC might assume you owe tax if you don’t report periods with no payments, potentially leading to fines.
2. Accurate record-keeping: It ensures HMRC has up-to-date information about your payroll activities.
3. Reclaim money owed: It’s the mechanism for recovering statutory payments from HMRC.
4. Maintain compliance: Regular and accurate EPS submissions keep you in good standing with HMRC.
5. Manage cash flow: By reporting correctly, you avoid overpaying taxes or facing unexpected bills.
6. Demonstrate due diligence: It shows you’re actively managing your payroll responsibilities.

Submitting an EPS is not just a bureaucratic task; it’s an important communication between your business and HMRC. It helps maintain accurate records, ensures you’re paying the correct amount of tax, and keeps your business compliant with UK payroll regulations. By understanding when and why to submit an EPS, you can manage your payroll more effectively and avoid potential issues with HMRC.

Information to Include in an EPS

When preparing an Employer Payment Summary (EPS), it’s crucial to include all the necessary information to ensure accurate reporting to HMRC. Here’s what you need to include in your EPS:

1. Company Details:
   • Employer PAYE reference
   • Employer name
   • Employer address
2. Payment Period:
   • The tax month or year the EPS covers
3. Financial Information:
   • Statutory payments recovered (e.g., Statutory Maternity Pay, Statutory Paternity Pay)
   • NIC compensation on statutory payments
   • CIS deductions suffered
   • NICs holiday information (if applicable)
4. Employment Allowance:
   • Indicate if you’re claiming Employment Allowance
   • The amount you’re claiming (up to the annual maximum)
5. No Payment Indicators:
   • Reasons for no PAYE payment (e.g., no employees paid in this period, employees paid below the Lower Earnings Limit)
6. Final EPS for the Year:
   • Indicate if this is the final submission for the tax year
7. Apprenticeship Levy:
   • Annual apprenticeship levy allowance
   • Total apprenticeship levy due to date
8. Adjustments:
   • Any adjustments to the total amount due to HMRC

By including all these elements in your EPS, you ensure that HMRC has a complete and accurate picture of your payroll activities. This helps prevent discrepancies and potential inquiries from HMRC, keeping your payroll process smooth and compliant.

How to Submit an EPS to HMRC

Submitting an Employer Payment Summary (EPS) to HMRC might seem daunting, but it’s a straightforward process when you know the steps. Here’s a clear guide on how to submit your EPS:

1. Choose your submission method:
   • Online: Use HMRC’s PAYE Online service
   • Payroll software: Many payroll programs have built-in EPS submission features
   • API: For larger businesses, direct system-to-system submissions are possible
2. Gather necessary information:
   • Your PAYE reference number
   • Your Accounts Office reference
   • The tax month and year you’re reporting for
   • Details of any statutory payments or recoverable amounts
   • Information on any NIC holidays or employment allowance claims
3. Log in to your chosen submission platform:
   • If using HMRC’s online service, log in with your Government Gateway credentials.
4. Navigate to the EPS submission section:
   • Look for options like “Submit an Employer Payment Summary” or “File an EPS.”
5. Enter the required information:
   • Fill in all relevant fields with the data you’ve gathered. Be sure to double-check for accuracy.
6. Review your submission:
   • Before sending, carefully review all entered information to ensure it’s correct and complete.
7. Submit the EPS:
   • Once you’re confident in the accuracy of your data, submit the EPS to HMRC.
8. Save the confirmation:
   • After submission, you’ll receive a confirmation. Save this for your records as proof of submission.
9. Address any errors:
   • If HMRC’s system detects any issues, you’ll be notified immediately. Address these promptly to ensure a successful submission.
10. Follow up if necessary:
    • If you don’t receive a confirmation or encounter persistent errors, contact HMRC for assistance.

Tips for a smooth submission:

• Submit your EPS on time to avoid penalties
• Ensure your payroll software is up-to-date if using it for submissions
• Keep detailed records of all submissions and confirmations
• If you’re unsure about any aspect of the EPS, seek advice from HMRC or a qualified accountant

By following these steps, you can confidently submit your EPS to HMRC, ensuring compliance with payroll reporting requirements. Regular, accurate submissions help maintain a good relationship with HMRC and keep your business running smoothly. If you’re new to this process or encounter any difficulties, don’t hesitate to seek professional advice or contact HMRC directly for guidance.

Deadlines and Penalties for EPS Submissions

When should you submit an EPS to HMRC? The timing is crucial to avoid penalties and ensure compliance. Here’s what you need to know:

Submission Deadlines:

• If you’re reporting that you haven’t paid any employees in a tax month, submit your EPS by the 19th of the following tax month.
• For other scenarios, such as claiming Employment Allowance or CIS deductions, submit your EPS before you pay your PAYE bill.
• If you’re reporting statutory payments recovered or compensation, submit your EPS by 19th April following the end of the tax year.

Late Submission Penalties:

• HMRC takes late submissions seriously. If you miss the deadline:
• You may receive a penalty notice.
• Penalties start at £100 for businesses with 1-9 employees, increasing for larger companies.
• Continued late submissions can result in monthly penalties of £200 or more.

How to Avoid Penalties:

• Set up calendar reminders for EPS submission dates.
• Use payroll software that alerts you to upcoming deadlines.
• Submit your EPS early when possible to allow for any technical issues.
• Ensure your payroll records are up-to-date to facilitate timely submissions.

What if You Can’t Submit on Time?

• If you’re unable to meet the deadline due to exceptional circumstances:
• Contact HMRC as soon as possible.
• Explain your situation and request additional time.
• Provide evidence if required.

By adhering to these deadlines and taking proactive steps to ensure timely submissions, you can avoid unnecessary penalties and maintain a good standing with HMRC. Regular, on-time EPS submissions are key to smooth payroll management and regulatory compliance.

EPS submissions with payroll software

Streamlining EPS submissions with payroll software can significantly simplify the process for both accountants and business owners in the UK. Nomi’s cloud based payroll software offers a comprehensive solution for managing Employer Payment Summary (EPS) submissions efficiently and accurately.

For accountants, Nomi provides a powerful platform to handle multiple clients’ payroll needs, including EPS submissions. The software automates the generation of EPS reports, ensuring all necessary information is included and up-to-date. It also allows for bulk processing, saving time when managing numerous clients.

Business owners benefit from Nomi’s user-friendly interface, which guides them through the EPS submission process step-by-step. The software automatically calculates figures, reducing the risk of errors and ensuring compliance with HMRC regulations.

Key features of Nomi’s payroll software for EPS submissions include:

1. Automated EPS generation and submission to HMRC
2. Real-time updates on submission status
3. Integration with other payroll functions for seamless data flow
4. Customisable reporting options
5. Secure data storage and transmission
6. Automatic reminders for submission deadlines

Nomi also offers direct filing with HMRC, eliminating the need for manual submissions. This feature ensures timely and accurate EPS submissions, helping businesses avoid penalties for late or incorrect filings.

Whether you’re an accountant managing multiple clients or a business owner handling your own payroll, Nomi’s payroll software streamlines the EPS submission process, saving time and reducing the potential for errors

If you’re having trouble submitting Employer Payment Summary (EPS) to HMRC or managing your payroll efficiently, our cloud based payroll software could be the solution you need. Whether you’re an accountant or a business owner, our software streamlines the EPS submission process and simplifies overall payroll management.

Our user-friendly platform is designed to save you time and reduce errors, ensuring compliance with HMRC regulations. It offers features like automatic calculations, real-time reporting, and secure data storage, all accessible from anywhere with an internet connection.

To help you make an informed decision, we offer a free trial this trial period allows you to explore the software’s capabilities and see how it can benefit your specific needs. Experience firsthand how our payroll solution can transform your payroll processes and make EPS submissions a breeze. Book a demo today and discover a more efficient way to manage your payroll tasks.