By October 2013, all employers will need to have complied with the new Real Time Information requirements of HMRC. The changes, which represent by far the largest overhaul of the PAYE system since its birth back in 1944, affect every organization, large or small, and with the deadline approaching fast, concerns are starting to be raised about just how ready we are?
According to Phil Robinson, CEO of IRIS, "there appears to have been a "burying heads in the sand" approach so far on RTI". At least, that's the impression he was left with after this year's conference season for accountants and financial controllers.
Despite the fact that small employers will move to the new system in April 2013 - barely six months away - and all organisations, even the largest employers, will be forced to migrate by this time next year, many businesses are yet to firm up their plans to ensure compliance.
HMRC RTI - The facts
What? - Real Time Information (RTI) is a significant development in the way that employers report earnings for the collection of tax and national insurance within the PAYE system. RTI will require every employer to provide information - which covers earnings, tax and NIC deductions - every single time a payment is made.
Who? - All businesses must comply with HMRC RTI.
When? - Most small organisations (those who number less than 250 employees) would have joined the scheme by April 2013 with large companies joining in a phased way, all of them by the ultimate deadline of October 2013 - a deadline which is unlikely to shift.
Penalties for non-compliance
According to Steve Wade, Director of international executive services, tax and pensions, at KPMG, "repeated submission failure under RTI may be taken by HMRC as PAYE compliance failure, which could impact reporting under the senior accounting officer regime. Under RTI late filing and late payment penalties will be issued automatically, with additional penalties for incorrect returns also applying. Further details on the penalty regime are expected before the issue of the draft finance bill on 11th December."
What should businesses do?
The most important thing any business can do in preparation for RTI is to recognize the need for urgent action. Issues such as whether your payroll operations are in-house or outsourced and whether you pay for licensed software will affect how you actually set the wheels in motion for compliance but, in reality, many firms will find themselves consulting experts who can provide specialist advice concerning the fastest - and most cost effective - routes to compliance.
At a minimum, here are the questions you need to be asking today:
* How will I source RTI compliant software
* How much will it cost
* What are the implementation timescales
* What changes are required to the data I supply
* What training and support can I access
It is only be facing the challenge head on that employers can ensure readiness and with significant penalties likely for non-compliance, it really is time to move into the implementation phase.
Why HMRC RTI BACS Approved Software?
1. Customers don't need to pay for any upgrades relating to RTI Submission.
2. Cloud Based solution which means no hardware's or legacy solutions to manage.
3. Highly secure giving you peace of mind.
Mission- to provide accessible online finance systems for our customers, for a one-off subscription fee. How do we do it? By creating an online cloud-based finance system that you can access anytime, anywhere, as long as you are connected to the internet. Why not find out more by clicking on this link to our website? You can read about why our cloud-based finance solution has no negatives; we'd be delighted to talk with you.