HMRC – RTI: An AccessPayUpdate&Guide To Real Time Information (RTI) &'Full Payment Submission'
01/07/2013 11:37
You probably already know that Her Majesty’s Revenue and Customers (HMRC) are changing the rules for how BACS payroll payments are submitted. These new rules have been named RTI or Real Time Information by HMRC.
HMRC RTI has been implemented in stages. The pilot program started a while ago and has been declared a success, so now the full roll out is scheduled to happen between April 2013 and October 2013. After October 2013 HMRC RTI will be mandatory.
This is good news for sepa payments customers too, because the HMRC updates will be instantly catered for by the Cloud-based AccessPay software.
So what does this mean for your company?
Currently employers and pension providers submit PAYE (tax, deductions, NICs) information annually at the end of the tax year to HMRC.
In the future RTI will require PAYE information to be submitted to HMRC before or on the date that your payroll is run and payments are made to your employees. Employers can choose to submit the information to HMRC online via the Government Gateway or the Electronic Data Interchange (EDI), but either way the AccessPay system will be able to cover them both.
The information sent to HMRC will be known as a 'Full Payment Submission' (FPS) and will include details about tax, NICs and other deductions when or before the payroll is run.
Employers will need to submit a FPS as part of RTI for any weekly, monthly or interim payroll processing they have in place that involves PAYE; regardless of the method they use to make payments to employees.
What are the benefits of HMRC RTI?
Introducing RTI via sepa will increase the frequency that PAYE information is received by HMRC which should:
• Improve the accuracy of data and deduction calculations; and
• Help reduce the number of bills and repayments sent after the end of the tax year by HMRC
RTI will also help streamline some existing processes by removing certain elements and instead require that the same or similar information to be submitted via RTI.
This includes the following:
• Removing the need for the end of year return (P35, P14 and P38A)
• Simplifying the employee starting and leaving processes, removing the need for P46 - starter information to be sent as part of the more frequent RTI payment
submissions
In future RTI will also help support the introduction of Universal Credits by providing the Department of Work and Pensions (DWP) with up-to-date information about claimants' employment income, and again the sepa direct debit system can handle this too.
What happens at year-end?
At year end, employers will still need to provide each employee with a P60 form and complete and file any forms P11D and P11D(b).
What does it mean for employers' payroll systems?
Employers should ensure that their payroll system can produce the necessary PAYE information in the required format to be submitted online via the Government Gateway or the Electronic Data Interchange (EDI) as part of RTI requirements. AccessPay customers will be able to integrate their systems so RTI is catered for.
Are there any other long-term goals for HMRC RTI?
In the longer term it is envisaged that PAYE information will be submitted to HMRC via the BACS system as this is the means by which the majority of employees use to receive their weekly wage or monthly salary.
To learn more about HMRC RTI call AccessPay now on 0845 111 0563 or contact them online at www.accesspay.com.