Have
you got your head around Real Time Information (RTI) yet? Many small businesses
are saying that they were not able to ready themselves for the deadline for
this new tax regime.
Submitting Payroll
Data to the Revenue in Real Time
Under
RTI, you have to make online submissions of information about employees and
their pay to HMRC on or before the day they are actually paid. If you pay
monthly, that means once a month, but for anyone paid weekly, the RTI return
must be submitted every week. This is instead of sending in the quarterly and
annual employer returns and is a major change in the work relating to payroll
operation.
For
many companies, the changeover date was 6 April 2013, but small businesses were
given a less stringent regime with more time to prepare for it. They could
submit their returns monthly even if they paid some employees weekly. Of
course, they still would have to find the wherewithal to update their systems
or invest in new payroll software, as well as to set up new procedures and
resource them.
Employee
details are critical. It is particularly important that national insurance
numbers and dates of birth are accurate, and home addresses must be kept up to
date. It’s a tall order for a small operation, but of course, your outsourced
bookkeepers will be up to the job.
Period of Grace for
Small Businesses Extended
Since
many of the smallest businesses have reported their concerns that they have
still not managed to prepare themselves properly, HMRC have now extended the
full deadline for those with fewer than 50 employees to March 2015. If you fall into this group, you can continue
to submit your returns monthly until this date, so you still have a few months
of grace.
With
the help of your bookkeepers,
even if you aren’t ready yet, you could most likely manage it before then. The
sooner you can submit returns on or before wages and salary payment dates, the
sooner you can breathe your sigh of relief knowing that you won’t be penalised
from March next year.
Remember
though, that if your business is doing well enough for your employee numbers to
be growing and likely to hit the magic 50, you have no choice but to comply
with RTI. Otherwise automatic fines that cannot be avoided will be applied.
