April is fast approaching and so is the introduction of HMRC’s new PAYE System Real Time Information (RTI).
All Employers should now have received information from HMRC on RTI, however it may seem like a lot of work. Below are the things you need to do to be ready for the introduction of RTI.
- You need to use a HMRC approved RTI Payroll Software. A list of these can be found at www.hmrc.gov.uk/payerti.getting-started The HMRC Basic Calculator is only suitable for Employers with under 9 employees.
- Check that all your employee details are correct. You need Full Name, Address, Date of Birth, National Insurance Number, Start Date, Average Ours Worked (A – 0 to 15.99, B – 16 to 29.99, C – 30 + or D – Other (only to be used in certain circumstances))
- If you do your own PAYE, make sure you are registered for PAYE Online Services
- All employees, even those who are temporary employees or are paid under the Lower Earnings Limit must now be included on the payroll submitted to HMRC
From 6 April everytime you pay your employees you must submit the information to HMRC. This is done by submitting a Full Payment Submission (FPS). The FPS details all the employees pay and deductions for that pay run and will also let HMRC know of any new employees or anyone who has left. If you have seasonal staff who aren’t being paid you will need to make sure that the irregular payment indicator is selected.
The FPS is submitted online using the government gateway PAYE Online Services which will be linked to your payroll software when you set it up.
The other reports that will be produced are the Employer Alignment Submission (EAS) and the Employer Payment Summary (EPS). The Employer Alignment Submission will only be used by Employers with 250 + employees and must be run before the first FPS to align their date with HMRC. Employers with less than 250 employees will have their data aligned when they submit their first FPS.
The Employer Payment Summary (EPS) is a report made to HMRC each month to cover the following situations:
- Where no employees were paid in a tax month
- Where an employer has received advance funding for statutory payments
- Where statutory payments (such as SSP, SMP, OSPP and ASPP) are recoverable together with the SMP NIC Compensation
- Where an NOIC holiday is being claimed
- Where CIS deductions are suffered which could be offset
The information supplied by this report will be offset against the amount of PAYE due on the FPS to give the actual amount of PAYE due. The EPS needs to be with HMRC by the 19th of the month.
It will be essential that you pay your PAYE for each month (or quarter if set up for quarterly PAYE) by the 19h of the following month. If the payment is not made to HMRC there is greater risk of penalties being enforced especially if it is a regular occurrence.
Further information on RTI can be found on HMRCs website.
At Vincent and Co we are happy to assist you with and questions or help you require with these changes. Please contact us on 01803 500500