PAYE RTI Attention – Real Time Information (RTI) is coming
PAYE RTI – Employers need to get ready for major payroll changes that come into effect in April 2013.
In April 2013 employers will have to start sending PAYE RTI returns electronically, using RTI-enabled payroll software, to HM Revenue and Customs (HMRC) each time you pay your employees as part of routine payroll processes.
The returns will include details of all employees’ pay, tax and deductions.
This new process will replace sending a separate return at the end of the year.
To be ready employers will need to start checking and updating employee information.
It’s vital that the information employers have about their employees is accurate and up to date.
Employers will need to send their first return – called a ‘Full Payment Submission’ or ‘FPS’ for salary or wage payments made to employees on or after 6 April 2013.
Although reporting PAYE in real time will be straightforward for most, some preparation is needed.
There is more to it than simply buying or updating software – although this is key.
Employers may need to add employees such as casual’s or those below the Lower Earnings Limit to their payroll system.
You must think about your payroll practices to make sure that they work for real-time reporting.
Reporting PAYE RTI will bring it into the 21st century and will allow HMRC to receive information on employees’ earnings, tax and National Insurance Contributions (NIC) as they are paid, rather than at the end of the year.
HMRC say “it will make it easier for employers to administer PAYE RTI and will make tax more accurate”.
PAYE RTI will also support the operation of Universal Credit – the Government’s flagship welfare programme – which brings together means-tested in and out-of-work benefits, Tax Credits and support for housing, and will improve work incentives and make work pay.
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