This year, all businesses will have to change the way they report PAYE. The Forum of Private Business has been working with HMRC on their Real Time Information (RTI) programme. Rachel Andrews, Financial Director of Andrews Computer Services and the Forum’s Adviser on payroll issues, is one of the small businesses taking part in the pilot of RTI. This is the fifth fortnightly blogs ahead of the introduction of this fundamental change. There is now less than a month to go before RTI comes in for employers. I have outlined some of the major actions that businesses need to take ahead of April 6 and shared some of the minor obstacles I have faced. Overall however, the pilot in which I have taken part has been a positive experience and the transition to RTI a relatively easy one. However, what the pilot cannot replicate is how HMRC will cope with so many new employers coming on board with RTI. In fact, Forum of Private Business research shows that business owners are less worried about the process of RTI and more worried about HMRC’s computer systems. So I am going to use this blog to share some of the support that is available out there. First of all, HMRC has a list of commercial software providers that provide free payroll software which is RTI compliant on their website – click this link. Further support will be offered by the department through flyers and emails, regular live Twitter Q&As, YouTube videos and roadshows across the country to support the roll out of this policy. An interview with an employer already using RTI, Richard Burchell can be seen on YouTube at http://bit.ly/W1FoXa. If you are using commercial payroll and/or Bacs software then you should speak to their provider and upgrade their existing software if necessary. Employers using an agent, payroll bureau or payroll service should check with them about what they need to do to get ready for RTI. HMRC have said there will be no fines for late submission of information whilst employers get used to the system. However, there may well be fines for incorrectly submitted information. So do make sure that all the employee information you collect is correct before submitting it to HMRC. The Forum of Private Business will of course be on hand as well – you can call the helpline on 0845 130 1722 if you have questions. Finally, I am asked why employers are being asked to do this? The answer is that RTI will support the operation of Universal Credit – the Government’s new welfare programme – which brings together means-tested in work and out-of-work benefits, Tax Credits and support for housing. Real Time Information will support more accurate payment of allowances to workers, tracking the income they receive and save lots of time at the year end when everything needs to be reconciled. The benefits for employers will be that they no longer have to prepare and submit a separate annual return (forms P35 and P14) and RTI should simplify the reporting requirements for employees who join or leave during the year. HMRC has recently written again to all employers about RTI, outlining the steps they need to take to be RTI ready. If you have questions about the new Real Time Information programme, Rachel is happy to answer them. Email us at email@example.com.
Payroll expert Rachel Andrews explains what businesses have to do to comply with RTI and her experience of using it.