HMRC & Real Time Information
Her Majesty’s Revenue and Customs (HMRC) are introducing new payroll legislation. It will affect EVERYONE that pays anyone to work for them, from April 2013.
It is called Real Time Information (RTI) – it affects the way that we submit payroll/PAYE information to HMRC, on your behalf. As with most tax initiatives these days, it is backed up by threats of fines for submitting information late or incorrectly.
In simple terms it will mean that every employer (however small) is going to have to:
- Submit monthly returns to HMRC
- Include all employees (even those with no deductions)
- Keep more detailed and accurate information (for all employees)
- Monitor pay-dates more closely
- Never make a payment to anyone without submitting details
- Pay PAYE more promptly/regularly
Although this seems a burden, the long-term aims are good as HMRC and other government agencies are supposed to be using the new system work together and quicker to improve tax services and go some way to reducing tax evasion and benefit fraud.
As your Accountants we are keen to ensure that we (and therefore, you) are doing all we can, in good time, to be compliant and well-prepared, to ensure the flow of information is reliable and efficient so that we are working together to get the right information, submitted as quickly as possible, and thus avoid the potential fines.
The solution will be letting us take care of running this for you – all you need to do is keep in touch with us regularly, making sure we have everything we need to run the process for you.
How the scheme will be introduced:
- 1. You will be sent a letter, by HMRC, 4-6 weeks before you are expected to ‘go live’ with RTI. This date is not optional and cannot be changed. As soon as you receive this it is imperative that you inform us of the date. Failure to do so may result in a late RTI submission and a subsequent financial penalty.
- 2. On the date you are given by HMRC as your go-live date you need to submit an Employer Alignment Submission (EAS). This tells HMRC all about the employees you already have, and who has left in the year.
HMRC should issue more detailS/information to you as your go-live date approaches.
Most important of all – don’t worry about the problems, Astons are here to help you – we may just need to be in touch with each other more often about payroll.