HMRC Claim that RTI will make it easier for employers, pension providers and HM Revenue & Customs (HMRC) to administer PAYE in what is seen as one of the biggest changes in many years. Under RTI, employers and pension providers will tell HMRC about PAYE payments at the time they are made – as opposed to only at the end of the year.
Most employers will join RTI from April 2013 and all employers will be using the RTI service by October 2013.
In a recent announcement David Gauke, Exchequer Secretary, said: “RTI will ensure that the PAYE system meets the needs of the 21st century. It will improve the service to taxpayers by making it easier to ensure that people pay the right tax after a change of job. HMRC is committed to a smooth and on-time transition. The start of the pilot today demonstrates that RTI is on track.
He continued to say that ”RTI will remove administrative burdens of £300 million a year from employers, mainly from the abolition of the end-of-year PAYE returns process – the biggest single contribution that any tax change could make.”
HMRC believe that the commencement of the pilot scheme will allow them to iron out any wrinkles in a small, controlled environment so that they can ensure RTI is working smoothly as more and more employers join the pilot.
For those involved in the pilot scheme a specialist team of RTI experts will be on hand to support them through the pilot.”
HMRC announced that 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.
The Minister for Welfare Reform, Lord Freud, said: “I welcome the pilot announced – both Universal Credit and RTI are on track and on time to support the implementation of Universal Credit from October 2013. Interlinking Real Time information with Universal Credit will enable us to process claims automatically and more efficiently, allowing us to make the right payment based on real time earnings.”
HMRC have released two free webinars for those who want to take a close look at how RTI will work and the effects the changes will have. The links are below.
• “Real Time Information – an overview” a 15 minute look at the RTI timetable, main day-to-day changes employers will see, and what help and support is available https://www3.gotomeeting.com/register/274066646
• “Accurate Employee Information Matters – it can save time and money” - an 11 minute look at examples and the implications of inaccurate employee information, plus tips on how to avoid this and make sure that employee information is recorded accurately. https://www3.gotomeeting.com/register/261725806
For any further information on any of the issues outlined in this piece, please call the Advice Service on 01455 852555.