Real Time Information (RTI Payroll Changes)
RTI and getting it right: Speaking from Experience
Real Time Information (RTI) is fast approaching and if you haven’t started to think about how it’s going to affect you and your business then now really is the time to take a look. It’s the biggest change to the PAYE system since 1944.
RTI will come into effect for most businesses from April 2013 and will be mandated for all businesses by October 2013. However, there are already an increasing number of companies across the UK who are now submitting RTI submissions to HMRC as part of their normal payroll processing routines, which means that when it comes to your turn RTI will run as smoothly as possible
At Sage, we’ve been working closely with HMRC for some time on RTI and we’ve now got the largest number of customers in the UK confidently submitting RTI returns since the HMRC initiative started in April. Working closely with HMRC and our customers has put us in a great position to learn from experience and really make sure that we get RTI right. The number one thing we’ve learnt is it’s all about preparation, see below for our top tips on getting prepared for RTI and getting it right:
Find out what the legislative changes will mean to your processes by speaking to your payroll provider, for example managing starters and leavers. This will ensure you continue to pay your employees and HMRC on time, while also fulfilling the legislative requirements of submitting more frequently to HMRC. Check how your provider is getting ready for RTI and when their RTI enabled software will be ready, so you can get prepared ahead of the deadline. The most important thing is don’t leave it to the last minute, to help you get prepared there’s lots of useful free information at www.sage.co.uk/rti
Carry out a full data cleanse on your system to make sure all your data is correct. According to HMRC, THE 2009/10 employer returns showed there are 128 employees called Mr, Ms or Miss Dummy, 572 employees whose surnames ranged from “X” to “XXXXX”, 507 A N Others, 160 Tests, 100 Do Not Use, 75 staff called Casual, 11 Cleaners, nine Workers, six Students and 824 Unknown. Ensure all the information you have is up to date and that the correct names and National Insurance numbers for all of your staff are recorded. If the records you submit do not match those at HMRC, you may trigger the creation of duplicate or inaccurate records which could result in incorrect tax calculations or HMRC compliance checks.
Communicate with your employees and make sure they are aware of the changes and how important it is that the information they provide you is accurate and up to date.
Store all your business information securely so that you can react quickly to any requests, demands or legislative issues that arise. Use HMRC recognised payroll software for RTI to reduce the burden on doing payroll manually every month; this will help automate processes, mitigate errors and give you peace of mind that you are fully compliant. If you’re not sure if your software is HMRC recognised then you can check here: www.hmrc.gov.uk/softwaredevelopers/paye/rti-software-forms.htm it’s important not to assume your provider will ensure your compliance.
Make the most of available support Some software providers, including Sage have dedicated UK based help desks for you to contact. Use this facility to check with them that you have all the information you need for your RTI submissions, and remember that all responsibility for paying employees correctly, and in line with RTI, rests with the employer. Don’t be afraid to ask your payroll provider how they are preparing for RTI and how they are going to help you.
One of the businesses already submitting on RTI is the Chartered Institute of Payroll Professionals (CIPP) who made their first submission back in July with the help of Sage and David Gauke, Exchequer Secretary to the Treasury.
Lindsay Melvin, Chief Executive of the CIPP, said “With help from Sage, our experience on the RTI pilot has gone very smoothly and it has given us the confidence and practice to report our PAYE data in real time going forward”. David Gauke shared the same enthusiasm after actually hitting the ‘submit’ button commenting “that was really very simple”.
We’re pleased to say these views have also been echoed by our customers currently submitting RTI. It’s been great to hear a pretty much consistent statement after clicking the submit button: “Is that it? That was easy”.
So the key is preparation, preparation, preparation. Make sure you have the information and support you need to get ready for RTI ahead of the game. For more information and guidance on RTI you can use our support pages at www.sage.co.uk/rti
You can find out more about CIPP’s experience of their RTI submissions at the Payroll World Autumn Update conference where Sage’s Payroll Category Manager Jon Cowan will be speaking alongside Shirley Harris from the CIPP in the session Learning from those who have already “been there and done it” with RTI. For more information visit: www.eventsforce.net/athene/frontend/reg/thome.csp?pageID=445&ef_sel_menu=14&eventID=3&eventID=3
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