Real Time Information (RTI)
Real Time Information is a new system being introduced by HM Revenue and Customs (HMRC) to improve the operation of the Pay As You Earn (PAYE) system. In principle, the RTI system entails submitting payroll information electronically to HMRC on or before the normal pay date e.g. weekly or monthly.
RTI will be mandatory for all employers starting from 6 April 2013. Between 6 April 2013 and 5 October 2013 employers will be given their RTI compliance dates and may only have a relatively short notice period to comply. All employers will be compelled to use RTI by 6 October 2013.
There are three practical side-effects of the new RTI system:
It is inevitable that there will be penalties for employers who fail to submit returns or submit returns late as well as the existing penalty regime for late payments. Even the smallest businesses could face penalties of more than £2,000 a year for failing to file PAYE returns online and on time.
RTI will provide the Department for Work and Pensions (DWP) with up to date information about claimants’ employment income, enabling them to calculate a Universal Credit payment without the need for a claimant to supply employment or pension income information. The Universal Credits system will also be launched in 2013.
RTI will undoubtedly place extra pressure on employers to ensure that they comply with this new regime. For more information about RTI and how we could help, please do not hesitate to contact Lorraine Wilkinson (Payroll Manager).
Author: Lorraine Wilkinson
Lorraine joined Scott & Wilkinson in 2001 bringing with her over 20 years payroll experience. As payroll manager, she oversees the smooth running of the firms payroll bureau which includes all aspects of day to day payroll. Lorraine is...
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