A month’s gone by for RTI

So, we’ve had our first month end since real time information (RTI) was put in place. Following on from my first blog on the subject back in February, after all the hard work, it seems to have passed without incident for most of us.

After making a few enquiries, it would seem the main people who struggled were our dear friends at HMRC.

Some submissions didn’t get through, towards the end of that first day, due to the large volume of companies all trying to upload their initial information at the same time.

I also have it on good authority that some large employers received a phone call asking them not to submit real time information for a further three months. The extra time may have been needed by HMRC so that it could roll out the initial stages of the universal credit scheme on time. Funny that I haven’t seen much on this in the press.

A statement also appeared on the HMRC website saying that they had received so many requests from employers to move to an annual scheme that they couldn’t cope with any more. Of course, one-person limited companies won’t want to be submitting PAYE returns every month…

Let’s hope that the current trend of 100% submissions continues, considering here within my companies, we submit every day.

For once, almost without a hitch, hats off to HMRC for at least getting something in and on time. Here’s hoping that the web gateway and back-end systems used to reconcile the information can cope. Time will tell.

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Real time information is on its way…

From April P60s become old hat. Instead of having this yearly round up of employees’ payroll, employers will have to submit real time information (RTI) every time a worker is paid; potentially up to 52 times a year for a weekly payroll.

PAYE itself will not change, but the way and the frequency with which employers send data to HMRC will.

This will only make HMRC more alive to PAYE arrears and accurate information being submitted. No more can businesses use PAYE as cash flow, and many will struggle with the transition from using this creditors’ payment terms.

HMRC has said it will be lenient on employers during the first year when it comes to penalties for failing to submit information, but nothing has been said in relation to how they will handle arrears or overdue payments.

Increased administration is going to be the main concern of most companies, but most software providers have already updated, so the impact, other than a data cleansing exercise, should be minimal.

An easy win for HMRC?

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