What might an EPS include related to employee deductions?

An EPS, or Employer Payment Summary, is a report submitted to HM Revenue and Customs (HMRC) that outlines the adjustments an employer is making to their PAYE (Pay As You Earn) liabilities. Among its various functions, one of the key elements it can include is reclaims of Construction Industry Scheme (CIS) deductions.

In the context of the Construction Industry Scheme, subcontractors in the construction sector may have deductions made from their payments, which are then forwarded to HMRC. If a subcontractor is eligible to reclaim some of these deductions, they would report their reclaims through the EPS. This is particularly relevant for employers within the construction industry, as it ensures they can accurately account for the amounts they are reclaiming against their PAYE liabilities.

The other options do not align with the purpose of the EPS. Employee background checks, medical benefits, and annual performance reviews typically fall outside the scope of payroll reporting and are not directly reported to HMRC for taxation purposes. Instead, these elements relate more closely to human resources management rather than to tax deductions or employer payment summaries. Thus, reclaims for CIS deductions being part of an EPS is essential for ensuring compliance with tax reporting requirements in the construction industry.