What Does Real Time PAYE really mean? Ken at our Experts' Wilds Accountants Explains
"Almost all employers will have to report payroll information on or before every pay day to HMRC electronically in real time from 6 April 2013.
So are you ready?
Just to bring you up to speed this is the biggest change in PAYE since it was introduced in 1944 and here is what you need to know.
Most important you need to ensure your payroll software is able to cope with RTI. If not you should consider using a payroll bureau. Manual payroll is no longer an option. HMRC are offering their free basic PAYE tools for employers with less than 10 employees - http://www.hmrc.gov.uk/payerti/payroll/bpt/index.htm
Your data must be complete and accurate. You should check you have all the basics, your employees full name (spelt correctly) and their genders, dates of birth and national insurance numbers correctly recorded.
Your payroll records will have to include the approximate number of hours worked by each employee and full details of any employee paid below the National Insurance lower earnings limit.
There are new procedures for all the various changes that may occur including employees starting, leaving, or going on parental leave, reaching state retirement age, being given a new code number and various other situations. You will need to record all this information promptly and pass it on to your payroll department or bureau.
There will no longer be a P35 end of year PAYE return from 2013/14 onwards but you will still need to provide every employee a form P60 and make online returns of employee’s expenses and benefits.
RTI will not change the tax payment dates and your monthly PAYE must still arrive with HMRC by 22nd of the month if you pay electronically or by the 19th if you pay by post.
RTI will bring additional penalties; those for inaccuracy will be considered in Summer 2013 and those for late submissions in April 2014."