A new consultation group has been formed by HMRC to tackle issues concerning payroll, payroll software and other areas such as including Real Time Information (RTI). The Employment and Payroll Group is made up of representatives, employers, bureaux and software developers. The Chartered Institute of Payroll Professionals will be co-chairing the group.
Initially meeting on 4th December 2014, following the Autumn Statement, the aim of the group is to raise issues with payroll and PAYE, which includes the RTI system that became compulsory for all employers from 6th April 2013, with most using the system by October 2013.
The key benefits of the group include stakeholders being informed about important changes to policy and process. Stakeholders will be able to review the guidance provided for users before changes are rolled out nationally, to raise any issues with the group. Once issues are identified, there will be a process in place for escalation by stakeholders.
Ruth Owen, the director general of personal tax, said that engaging with employers and others with a vested interest in the group would serve to improve customer processes.
The Employment and Payroll Group will replace the Expenses and Benefits Group, the Payroll Consultation Panel, and the Employment Consultation Forum.
Overview of RTI
Real Time Information is a change in the way you report PAYE information, rather than a change in the way PAYE is calculated. Instead of reporting information at the year’s end, employers will submit a report each time that an employee is paid. Even if no employees are paid during a particular period, you may still have to submit a report to HMRC.
What has changed?
Forms P35 will no longer be submitted at the end of every tax year to HMRC and P14 forms won’t be required any more. You will, however, have to provide each employee with a form P60 at the year end, along with forms to report any employee benefits. Although a P45 will be given to employees, you won’t have to send them to HMRC.
What will happen if I don’t comply?
If you don’t submit the Full Payment Submission or the Employment Payment Summary in a timely manner, you will be hit with a penalty charge from HMRC. If you fail to make payments on time, you will also be charged a penalty.
How are you managing with RTI? Are you finding the new system difficult to manage? Let us know what you think at The Accountancy Partnership.