Introduced in 2013, RTI is the most significant change ever made to PAYE.
What is PAYE RTI?
Real Time Information (RTI) is a new way of reporting PAYE, designed to make PAYE submissions more efficient and accurate.
RTI doesn’t change the way PAYE is calculated, it just means that submissions need to be made more regularly.
Under this system, employers tell HMRC about PAYE payments in real time as they are made, as part of their payroll process, rather than once a year with their end of year return.
So, you’ll still need to:
- Provide P60s
- Submit P9D, P11D and P11D(b) forms
But you’ll no longer be required to submit:
- P14 forms
- P35 forms
- P38A returns for casual employees
- P45s to HMRC
Before RTI, the PAYE system had changed very little since it was introduced in 1994.
HMRC decided to make these changes to the system in order to:
- Enable a more efficient response to PAYE errors such as over payments or under payments
- Support the introduction of Universal Credits
- Reduce fraud and ensure that people receive the benefits they are entitled to
- Provide the Department for Work and Pensions with up to date information about each claimants employment income efficiently
Under the RTI system, employers are required to report employee payments and reductions, including National Insurance on each employee’s earnings, to HMRC for each pay period.
Each time your payroll is processed, you’ll need to calculate how much tax and NI you owe, then send that information to HMRC via an FPS. If you’re claiming any reduction to what you owe HMRC, you’ll also need to submit an EPS.
If you do not submit a Full Payment Submission or Employer Payment Summary on time, or your payments are late, you will be penalised by HMRC.
RTI submissions can be time consuming and complex, putting a great deal of pressure on in house payroll teams.
However, it doesn’t have to be that way. Here at Easy PAYE, we’re experts when it comes to all things RTI!
Using our state-of-the-art RTI payroll software, we’ll simplify your RTI processes and give you all the support you need. We’ll send HMRC your Full Payment Submission (FPS) and Employer Payment Summary (EPS) submissions using the Real Time Information service, so you won’t have to.
For further information about our RTI services, or to discuss your requirements further, please get in touch – our skilled and experienced team are always happy to help!