Are you ready for the big changes coming in payroll reporting?
The start of the new tax year will mark the biggest single change to Britain’s payroll systems since the PAYE tax system was introduced in 1944 and this may prove a challenge for small businesses.
Real Time Information (RTI) means that each time an employee is paid, the employer must provide HMRC with details of the payment and tax deducted, all on a real-time basis. From the start of the next tax year in April 2013, the new Real Time Information (RTI) system will require all employers to submit payroll data to HMRC online. Many employers and pension providers will need to report their PAYE information every week or month from April 2013; all employers will have to do this by October 2013. The change, which will be phased in, will mean HMRC will not have to wait until the end of each tax year to work out if a person has paid the right amount of tax or not.
Tracy Irwin, payroll expert at TI Payroll & Accounting, Barrow-in-Furness, examines what the forthcoming changes to the PAYE tax system will mean for employers:
“There are big changes ahead for employers, and they’re going to involve extra administration and costs, so you need to be prepared. The measure sounds fine in principle, where HMRC estimate it will save businesses £300 million in running costs and will also help employers to avoid penalties for late payments. However, in practice, the system may prove a nightmare for some small businesses who aren’t systematic with their payroll. Employers who have systems in place, shouldn’t find the transition to RTI too difficult.”
Tracy continued: “The new changes have not been very well flagged-up, so very few employers are well prepared for the changes ahead. Neither are people aware, how this will affect every employer from Tesco, to small businesses with only a handful of employees. To help take some of the anxiety away from employers, who are unsure how they will be affected by RTI, I will be holding a series of free seminars to discuss this topic.”
The seminars will take place on the 28 March at the Abbey House Hotel, Barrow-in-Furness at 9am-11am and also at The Castle Green Hotel, Kendal, 1pm-3pm.
TI Payroll would like to thank their sponsor Peninsula Business Services for kindly agreeing to fund the seminars.
Any companies not yet ready should at least be sourcing new payroll software, or updating their current payroll software, to make sure it’s capable of sending PAYE information to HMRC in real time.
Small businesses don’t need to worry too much about the expense, as HMRC is offering an alternative free basic package for employers, but only for those with nine or fewer employees.
ENDS
For further information on RTI, or if you wish to attend one of the seminars, please contact Tracy Irwin, TI Payroll & Accounting, Tel: 01229 840348 or email tracy@tipayroll.co.uk. www.tiaccountancy.co.uk
Media enquiries to: Cherie Fox, Fox Communications, tel:015395 61025 mob:07799 295409 or email to cherie@fox-communications.co.uk
