Major PAYE reporting changes just days away

BWF members are reminded that, from April 6th 2013, employers will be legally required to report PAYE in real time. This is the biggest change to PAYE in 60 years and means that information about all PAYE payments needs to be submitted to HMRC online each time a payment is made as part of the payroll process, rather than at the end of the year as they are now.

This means that employers (or their accountant, bookkeeper or payroll bureau) will have to:

• send details to HMRC every time they pay an employee, at the time they pay them
• use payroll software to send this information electronically as part of their routine payroll process

The new way of reporting is called Real Time Information, or RTI, and the change has been made in order to gather regular information about employees, to dramatically simplify reporting new starters and leavers and to make the payroll process easier for business. It will also support the payment of Universal Credits.

A recent survey revealed that the government is struggling to communicate the changes to small firms. A snap poll of 1,700 small firms last year found that only 16 per cent of respondents were fully aware of the change to RTI, and a quarter of those responding had never heard of it.

BWF Operations Manager Tracey Hemming commented:

“Businesses will need to make sure that their April payroll is under the new system. Companies using payroll software will need to ensure that it has been updated or that they are using an amended version which allows for the new way of reporting. You should be able to contact your payroll system provider to confirm this. Members are also reminded that they can call the BWF member helpline for advice on tax and employment issues.”

You can find out more about the changes here: www.hmrc.gov.uk/rti/index.htm