Define Legal Reporting Units and Tax Reporting Units

A legal reporting unit (LRU) is the lowest level component of a legal structure that requires registrations. It groups workers for tax and social insurance reporting or to represent a part of your enterprise with a specific statutory or tax reporting obligation.

A LRU is automatically created when you create a PSU.

Create Legal Reporting Units

To use a legal reporting unit for tax reporting purposes, you must also set it as a tax reporting unit (TRU). The TRU holds the Employer's PAYE Reference number. It is mapped to the Employer Registration Number on the TRU registration.

To create a legal reporting unit:

1. Click Navigator -> Setup and Maintenance.

2. On the Setup page, select the Workforce Deployment offering.

3. Select the Legal Structures functional area and then Define Legal Entities for Human Capital Management.

4. On the Select Scope page, select Manage Legal Reporting Unit.

5. In the Legal Reporting Unit field, select Create New.

6. Click Apply and Go to Task.

   Note: An LRU with the same name as the legal entity is created by default. This LRU is set as the main legal reporting unit.

7. To create another LRU for this legal entity, click Create.

8. Enter the required information on Create Legal Reporting Unit page.

9. In the registration information, select the jurisdiction United Kingdom HMRC. Enter the PAYE scheme.

   Note: The PAYE scheme must be in the specified format with a forward slash to separate the two components of the PAYE scheme, for example CCC/12345.

10. Select the legal address.

11. Select No for Main Legal Reporting Unit.

12. Click Save and Close.

Identify the Legal Reporting Unit as Tax Reporting Unit

You must configure additional information for legal reporting units to set them as tax reporting units.

To configure the TRU:

1. Select the Manage Legal Reporting Unit HCM Information task.

2. On the Legal Reporting Unit HCM Classification page, select the check box Tax Reporting Unit to set the LRU as a TRU.

3. Click Next.

   On the Tax Reporting Unit Details page, complete the fields as shown below:

   This table lists the field names and their descriptions on the Tax Reporting Unit Details page.

   Field	Description
   ECON	Identifier given by legal authorities to employers who contract out of the state pension scheme. This is only required for historical reporting purposes.
   Sender ID	Unique identifier given by HMRC to the employer to identify the files sent by the employer.
   Unique ID List	Identifier for the list of unique IDs for this tax reporting unit. When a personal calculation card is associated with the TRU, you can select a unique ID from the list.
   Employer Accounts Office Reference Number	Unique ID issued by HMRC accounts office to the employer.
   Service Company	Indicates a company that operates in the intermediaries' legislation, also known as IR35.
   Corporation Reference Tax	Unique ID issued by HMRC to employers who pay income tax.
   Self Assessment Unique Identifier	Unique ID issued by HMRC to employers to submit self-assessment for taxation, for example sole proprietorships or partnerships.
   Employment Allowance Indicator	Indicator to post in the Employer Payment Summary (EPS) file.
   Account Holder Name	Used to post information in the EPS file.
   Branch Sort Code	Used to post information in the EPS file.
   Account Number	Used to post information in the EPS file.
   Building Society Reference	Used to post information in the EPS file.
   Late PAYE Reporting Reason	Used to post information in the Full Payment Submission (FPS) file.
   DEO Employer Reference	Used to report on the DEO (Court Order) Payment Schedule.
   Exclude from Apprenticeship Levy	Indicator for the NI earnings of an employee in this TRU to be excluded from apprenticeship levy calculation.
   Apprenticeship Levy Apportioned Allowance	Used to apportion the allowance for apprenticeship levy, in case of multiple TRUs.
   Apprenticeship Levy Employers Pay Bill YTD	Used in case of data migration within a tax year. It holds the year-to-date value of the employee's pay bill to include it for reporting purposes.
   Apprenticeship Levy Employers Pay Bill Date	Used to identify the year of apprenticeship levy employees pay bill YTD. This will only be used in the tax year when data migration happens.

4. Click Save and Close.