RTI – Real Time Information
Welcome to my blog. My aim is to give my views, ideas and suggestions on a variety of mostly tax topics of current interest. I trust you will find it interesting and informative. I start with the RTI system.
HMRC’s new RTI (Real Time Information) has been in operation for some time, since all new employers have been automatically enrolled in it. It applies to all existing employers for the 2013/14 tax year onwards, though small employers may defer reporting until October 2013.
The main difference from the existing system is the requirement for efiling of payroll data every time a payroll is run. Currently only starter and leaver information is filed during the tax year, and a year end P35 submission made after the end of the tax year. HMRC have said that the new system will save time since a year end P35 return will not been needed. In practice however this is unlikely to be the case since the final RTI submission of the tax year is in fact almost the same as the existing P35. In addition, the extra time and work in making online filings after each weekly or monthly payrun is certainly real. There is no doubt that RTI is definitely an extra burden on employers and payroll bureaux.
In my experience, if your payroll software can handle the current efilings and has been upgraded for RTI, then RTI isn’t really going to be an issue. This is certainly the case with my own payroll software from Iris. All you have to do is make that weekly or monthly efiling. The one key recommendation I would make to employers is to set up a direct debit to pay regular PAYE and NICs. With RTI HMRC will know the amount of your regular payment liability and so they should be able to collect the money directly, saving you the time and effort needed to make a BACS or cheque payment.