The P32 Report in QuickBooks Online Advanced Payroll details all the payments that are still owed to HMRC, as well as tax that has already been paid to on a per month basis within a financial tax year.
How to run a P32 Report in Advanced Payroll
Before you run a report, make sure you don’t have any unfinalised pay runs otherwise you’ll see the warning message 'There are unfinalised pay runs that may affect this report'.
To access the P32 Report, go to the Payroll Settings > Reports > HMRC Reporting.
Note: You can filter the report on a per financial year basis if you need to.
When you run the report you’ll see three tabs. Here’s a breakdown of the first tab:
- Tax Month: The tax month runs from the 6th of the month to the 5th of the next month. For example, the tax month April will cover all pay runs with a pay date from April 6th to May 5th.
- PAYE: All PAYE, excluding student loan amounts, deducted from employee pays for the pay runs falling within the tax month.
- Student Loans: All student loan amounts deducted from employee pays for the pay runs falling within the tax month.
- Net CIS Deductions: Short for Construction Industry Scheme, this is the net tax deducted by the contractors from subcontractors' payments which is to be paid to HMRC.
- Total PAYE: This is the total of PAYE and Student Loans for the tax month.
- Employer NI: All employer National Insurance Contribution amounts calculated for the pay runs falling within the tax month.
- Employee NI: All employee National Insurance Contribution amounts deducted from employee pays for the pay runs falling within the tax month.
- NI Deductions: The total statutory payments relating to maternity pay, paternity pay, adoption pay and shared parental pay processed in pay runs for the tax month. The second tab "NI Deductions Summary" details a breakdown of these payments.
- Employment Allowance: If the business is claiming an Employment Allowance, the amount will appear in this column. The allowance amount will be deducted (only from the Employer NI amount) up to a maximum £3000 for the tax year.
- Total NI: This is the sum of Employee NI + (Employer NI - NI Deductions - Employment Allowance).
- Apprenticeship Levy: The amount that you have paid for the Apprenticeship Levy.
- Advance Funding: Enter the amount you have paid manually here.
- HMRC Payments: Enter the total amount of payments you have actually paid to HMRC in this box to keep track of payments to HMRC.
- Total due: The sum of Total PAYE and Total NI.
- Total paid: Any payments made to HMRC can be recorded here. This is a manual entry and must be updated each time an amount is paid to HMRC. Read on for instructions on how to do this.
- Balance: The difference between Total Due and Total Paid. Note: This amount is cumulative for the whole tax year.
The second tab breaks down the NI Deductions into each separate statutory component. The amounts are automatically classified within the Recovered and NIC compensation columns based on whether the business is eligible for Small Employers’ Relief, and has been set up accordingly in your HMRC settings.
You can enter CIS deductions made and suffered in the CIS tab. The Net CIS deductions are also displayed in the CIS tab of this report. You can view them in the tax month and also quarterly and for the financial year.
You can record HMRC payments, Advance Funding and CIS payments manually from the P32 Report screen on the P32 tab and the CIS tab. To do this, select the fields and fill in the values.
Setting up Employment Allowance/Small Employers’ Relief
Both of these settings are switched off by default. If your business is eligible for either go to:
- Payroll Settings and then select HMRC Settings.
- Choose Yes.
You can export this report in a PDF format and is also available via Report Packs.