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PROTECT 05/11/20 12 Pay As You Earn Improving the operation of Pay As You Earn Real Time Information January 2013

Pay as you earn (PAYE)

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  • 1. Pay As You EarnImproving the operation ofPay As You EarnReal Time InformationJanuary 2013 PROTECT 05/11/2012

2. The objectives of the RTI Programme To modernise and improve the operation of PAYE sothat, over time, PAYE deductions for individuals willbecome more accurate To support the operation of Universal Credit whenintroduced in 2013 by the Department for Work andPensions PROTECT05/11/2012 3. Key facts The RTI Programme is on track and on time Unless in the pilot or HMRC has indicated a later date, the vastmajority of employers and pension providers will be legallyrequired to begin submitting PAYE information in real time inApril 2013 with practically all employers routinely reporting PAYE in realtime by October 2013 The structure of PAYE remains unchanged but the way in which employers and pension providers send PAYEinformation to HMRC is fundamentally changingPROTECT 05/11/2012 4. The pilot The pilot started as planned on 11 April 2012: 320 employers joined between April and June 2012 by the end of December 2012, more than 3 million individual records were being reported in real time; and by March 2013, we aim to have PAYE information being reported in real time for around 6 million individuals HMRC continues to work with payroll software developers andvolunteer employers to iron out wrinkles in a controlledenvironment PROTECT 05/11/2012 5. Feedback from pilot employers RTI is working well - the general consensus to date is thatreporting PAYE in real time is easy Support from both HMRC and software developers has been good Submission times remain quick: submissions with smaller numbersindividual records have been made in seconds and the largestsubmission of three schemes including over one million individualrecords was made in less than one hour. Bacs hashes continue to flow successfully and have been correctlymatched across the pilot schemes where payment to employees ismade via Bacs.PROTECT05/11/2012 6. Feedback from RTI pilot: Data Quality Data quality is important to prevent submissions being rejected.Check your data to ensure you have included all the mandatoryfields for all employees (Name, Date of Birth, Gender, Address) -and that it is correct. Include the NINO where known Check your submission to ensure that you have not included invalidcharacters such as or / in particular fields. Some characters maybe permitted in some fields and not others. Please check toensure you are using the most appropriate characters for eachfield. PROTECT 05/11/2012 7. Preparing for real time reporting: key actions Ensure employee data is correct and complete Full nameDate of birth National Insurance numberGender AddressPROTECT 05/11/2012 8. Tips in recording key employee informationDate ofNationalName Insurancebirth number Full forenames, Always enter not initials Always enterthe correct date the correct NIof birth Forenames and number surname in the Enter the day, Correct format correct ordermonth and full 2 letters, 6year, such asnumbers and a Make sure they 05/05/1985 final letter are spelt A, B, C or D correctly Verify from official Dont put titlesdocuments in name boxesPROTECT 05/11/2012 9. Feedback from RTI pilot: Payroll Alignment EAS or First FPS from April, where employers havedaily, weekly, monthly payrolls under one PAYE schemereference, the EAS may be submitted in parts. This does notapply when a First FPS is being submitted Dont forget to include all employees who currently work for you -and those who have left since 6 April. EAS and FPS timing after submitting the EAS or firstFPS, employers should wait 24 hours before submitting the FPS.PROTECT05/11/2012 10. Feedback from RTI pilot: Points to Remember! Ensure you have your correct Accounts Office Reference number. Ensure the amount reported on your FPS/EPS matches theamount paid on following 19th/22nd. Check you have registered for the Government Gateway and yourcredentials are valid prior to submission. Ensure that your Bacs software has been updated where you payyour employees by direct Bacs. Only include the cross reference (hash) where you make paymentof PAYE income via Bacs.PROTECT 05/11/2012 11. Recent announcements New guidance relating to the reporting of notional payments,earnings and notional payments delivered by overseas employersand employment income paid in respect of employment-relatedsecuritieshttp://www.hmrc.gov.uk/rti/expats-RTI.pdf Ad hoc payments made outside of the regular payroll andpayments which vary according to the work done on the day,where it is impractical to report on or before.http://www.hmrc.gov.uk/rti/employerfaqs.htm#14 New guidance relating to penalties, returns and payments for2012-13 and 2013-14http://www.hmrc.gov.uk/news/payerti-payments.htm PROTECT05/11/2012 12. Summary of key actions to take to preparefor real time reporting Update/acquire RTI-enabled software or use a payroll serviceprovider Ensure employee data is correct and complete Review: employee data recruitment and payroll processes Become familiar with the reporting requirementsPROTECT05/11/2012 13. Help and support Real Time Information homepage www.hmrc.gov.uk/rti/Preparing for operating PAYE in real time http://www.hmrc.gov.uk/payerti/getting-started/rti.htm Guidance on operating PAYE in real timehttp://www.hmrc.gov.uk/payerti/index.htm Information to be reported to HMRC http://www.hmrc.gov.uk/payerti/reporting/what-to-report.htm Data Quality homepagehttp://www.hmrc.gov.uk/rti/dip/index.htmPROTECT05/11/2012 14. Help and support FAQs for employers http://www.hmrc.gov.uk/rti/employerfaqs.htm Basic PAYE Toolswww.hmrc.gov.uk/payerti/getting-started/paye-tools.htm www.hmrc.gov.uk/bpt2013 Payroll Alignment http://www.hmrc.gov.uk/payerti/reporting/payroll-alignment.htm See payroll software that has PAYE Recognition http://www.hmrc.gov.uk/softwaredevelopers/paye/rti-software- forms.htm Register for e-mail alertswww.businesslink.gov.uk/hmrcemployeremailalerts PROTECT 05/11/2012