FAQ about RTI payroll changes…

RTI Changes are coming up. There is no hiding, or burying your head in the sand. BIG BROTHER IS watching you. And if you slip you, you’ll get done. BUT, don’t worry…This blog will help you to know what to do…

There are a number of important preparatory steps employers need to take in good time before the launch in April 2013…

1. Data Quality

PAYE RTI requires complete accuracy of all employee data. So just make sure that you have the right information on employees. You cannot ‘guess’ their DOB e.g. 1.1.77 … no more of that. Check that you have the correct info on people, especially:

  • Full names, including middle names (abbreviations are no longer allowed)
  • NI numbers
  • Birth dates
  • Gender
  • Address
  • Number of hours normally worked (less than 16, 16 to less than 30, 30 or more, other – if number of hours varies significantly)
  • Regularly paid – regularly paid employees are paid each week or month and will be in almost all pay runs. Those who take more than three months off at a time, such as seasonal workers, should be set as irregular.

 

2. SOFTWARE

All UK payroll software has effectively had to become PAYE RTI compliant.

PAYE RTI compliant software will allow employers to submit RTI returns directly over the Government Gateway via an internet connection.

Make sure the software you use is RTI compliant.

Make sure that you are registered with: www.Gateway.gov.uk – so that you can make your submissions online.

 

FAQ … The answers to some commonly asked questions…

What does RTI? Mean?

RTI stands for ‘Real Time Information’

What is RTI?

RTI is the biggest shake up to payroll since PAYE was introduced in 1994. It is a new filing regime being introduced by HMRC, this will allow HMRC to track employers’ payments, increase the accuracy of PAYE deductions and provide up-to-date information on employees’ earnings.

Is there anything I need to do?

RTI requires certain information about all employees and their payments. If you haven’t already started to, you need to collect any missing data for your payroll.

The information we need is:

  • Full names, including middle names (abbreviations are no longer allowed)
  • NI numbers
  • Birth dates
  • Gender
  • Address
  • Number of hours normally worked (less than 16, 16 to less than 30, 30 or more, other – if number of hours varies significantly)
  • Regularly paid – regularly paid employees are paid each week or month and will be in almost all pay runs. Those who take more than three months off at a time, such as seasonal workers, should be set as irregular.

If you’re unsure whether you have what you need, please contact us ASAP to see how Boogles Ltd can help.

What happens if someone is on long-term sick or maternity leave?

After three months of a regularly paid employee not being paid, HMRC will automatically delete that employee’s details from the database. To prevent this from happening, when an employee receives an SMP1 or SSP1 form, you will need to set them as an irregular employee until they return to work.

I forgot to pay someone – what do I do?

This isn’t a problem as long as there hasn’t been an FPS submitted for this person.

(An FPS is a Full Payment Submission. Every payment made for every employee will require an FPS. So it is just what we call the information is sent to HMRC about payments to employees.)

I need to make an adjustment and pay the employee outside of the pay cycle, is this possible?

Though possible, this is now far more difficult than it used to be. You cannot simply undo the payslip as you could if the adjustment was to be made next time. Are you sure your employee can’t wait for this payment?

Why are they doing this ?!

Quite frankly – there’s lots of small businesses out there, getting their payroll wrapped round their neck… they’re paying people casually by cash and not including them on the regular payroll. There’s lots of people who have more than one job, and the government want to keep track of who is earning what. The government also want to make sure that a company is paying the correct amount of tax each month and not just ‘what they feel like’ or ‘what cashflow will allow’.

Plus it means, if they get the info throughout the year as they go along, then there’s no longer any need for year end forms like the p35, and people who are getting benefits e.g. Working Tax Credits, Job Seekers etc., will now we shown up the minute they’re paid, and the AMOUNT they’ve been paid… no need to wait until the end of the financial year or to make an adjustment if someone has been over/under paid in tax credits the following year.

Basically, it helps Big Brother to keep an eye on you!

:)

 

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One Response to “FAQ about RTI payroll changes…”

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