Getting ready for RTI
August 29, 2012 | By Nimbus |
You have probably heard that HMRC are introducing a new method of PAYE reporting. Historically HMRC would receive either monthly or quarterly PAYE payments from employers and would only be able to reconcile these once the employer submitted their year-end return (Form P35). In the past the employers in financial difficulty were able to use HMRC as a creditor, by not paying the PAYE due and HMRC would not be aware of this debt.
HMRC have now introduced Real Time Information (RTI), not quite up to the minute, but real time information month by month. Therefore, from April 2013 or October 2013 (depending on the size of your business) all employers are required to submit their PAYE data to HMRC on a monthly basis. The payment dates remain the same, either monthly or quarterly, depending on the size of your PAYE liability.
There are potentially a few losers with the introduction of RTI. Students will unfortunately lose the ability to earn their full personal allowance in their summer holidays without being taxed! The good news is they will be able to claim back the tax, but will need to complete a Form P50 after their summer job has finished.
So what is all the fuss about? As with all changes in procedures there is a reluctance to adopt something new. At Nimbus Accounting we are well prepared for the change. Our payroll software will automatically transmit the necessary information to HMRC at a click of the button. There are firms, as always, trying to scare clients that there will be extra administration. If this sounds familiar, pick up the phone and give us a call at Nimbus Accounting, we will give you honest straight forward advice in plain English.
If you are based in the Brighton & Hove or Sussex area and want to discuss this, or any other matter affecting your business, please don’t hesitate to give us a call on 01273 782 742. Nimbus Accounting staff are all qualified accountants and have a specialist knowledge of SME accounting and taxation.