Archive for the ‘RTI’ Category

RTI Penalties from 6th March 2015

Posted on: February 9th, 2015 by Clive Headon No Comments

HM Revenue and Customs (HMRC) will be introducing penalties for employers who report their payroll information late from:

  • 6 March 2015 for employers with fewer than 50 employees

When penalties are charged

You can get a penalty if:

HMRC won’t charge a penalty if:

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Interim PAYE penalty letters sent in error

Posted on: July 1st, 2014 by Sarah Curzon No Comments

HMRC have apologised for sending a small number of interim penalty letters for 2013–14 in error.

The letters were sent to employers who, for the tax year ending 5 April 2014, sent:

  • a month 12 Full Payment Summary with zero financial values, declaring final submission for the year
  • a month 12 Employer Payment Summary (EPS) with zero financial values, whether or not declaring final submission for the year
  • a month 12 EPS claiming CIS deductions suffered
  • an Earlier Year Update with zero financial values

HMRC are urgently correcting this error and say that employers affected do not need to take any action.

PAYE Penalties and Interest – Employers Beware!!

Posted on: June 30th, 2014 by Sarah Curzon No Comments
Sarah Curzon, Tax Director, MHA Broomfield Alexander

Sarah Curzon, Tax Director, MHA Broomfield Alexander

Real Time information (RTI) reporting for most employer’s has been with us for over 12 months now and we are all becoming more familiar with the administration of PAYE under the RTI system.

HM Revenue & Customs (HMRC) have been focused on streamlining their systems and ensuring people pay in full and on time. In order to encourage employer compliance there are penalties and interest charges for employers who fail to comply and a new generic notification service (GNS) to forewarn employers of potential penalties.

RTI is complex and it doesn’t work properly all the time, so employers should beware.

Problems in the RTI system and employer’s lack of knowledge of the system will lead to a large amount of penalties together with a large number of appeals to the tribunals –  which already have a huge backlog, so  the RTI automatic penalty regime has been introduced in stages.

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The rapidly increasing importance of your payroll processes

Posted on: February 24th, 2014 by Sarah Curzon No Comments
Sarah Curzon, Tax Director, MHA Broomfield Alexander

Sarah Curzon, Tax Director, MHA Broomfield Alexander

When I first started working in tax payroll processes were primarily a means to pay staff members, with some reporting to HMRC required at the end of the tax year. Companies would often regard their payroll tax compliance as something which could be treated with a mild lack of care because the year-end reconciliation processes would allow any mistakes or underpayments to be corrected in a catch up process. Payroll taxes were seen as an easy way for companies to manage their cashflows by underpaying during the year and catching up at the end of the tax year.

Over the last few years the emphasis on the importance of payroll compliance has changed substantially and there have also been penalties introduced for getting payroll compliance wrong during the year. An increasing number of responsibilities have also been placed on the payroll provider or team by Government regulation.

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RTI – delay of introduction of penalties

Posted on: February 19th, 2014 by Sarah Curzon No Comments
Sarah Curzon, Tax Director, MHA Broomfield Alexander

Sarah Curzon, Tax Director, MHA Broomfield Alexander

HM Revenue & Customs have recently announced that there will be a staggered introduction of penalties for late payments and returns under PAYE Real Time Information (RTI) Reporting.

The new automatic in-year PAYE penalties for late filing and late payment and in-year interest (charged on tax and National Insurance Contributions (NICs) that are paid late during the year), were due to start from 6 April 2014.

HM Revenue & Customs have said that ‘RTI is a big change and HMRC and some employers are continuing to learn. Having listened to customer feedback, HMRC has decided to stagger the start of the new in-year late filing and payment penalties to give employers more time to adapt to reporting in real time. The new timetable will be:

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Employment Allowance for SMEs

Posted on: December 19th, 2013 by Sarah Curzon No Comments
Sarah Curzon, Tax Director, MHA Broomfield Alexander

Sarah Curzon, Tax Director, MHA Broomfield Alexander

Many small businesses identify at an early stage that they need help in managing, growing and developing the business (recognising both the strengths of the business owner but also the strengths that others can bring).

Some businesses seek outside support but others would like to take the bold step to employ staff.  One hesitation in taking this step can be the national insurance cost of employing staff members.

In the March 2013 Budget the Government announced that it would introduce an “employment allowance” of £2,000 a year for all businesses, charities and CASCs to offset against their liability for Class 1 secondary NICs, (to be implemented from 6 April 2014).

Details of this continue to be announced by HMRC:

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Micro employers to be given another two years’ grace from RTI requirements.

Posted on: December 10th, 2013 by Sarah Curzon No Comments
Sarah Curzon, Tax Director, MHA Broomfield Alexander

Sarah Curzon, Tax Director, MHA Broomfield Alexander

The deadline for compliance with real-time PAYE reporting (RTI) will be April 2016 for businesses with fewer than ten employees.

Those with up to 49 employees will have up to April 2014 – itself an existing easement – to send PAYE information about their employees in real time.

The latest easement, however, will not extend to business start ups during the period, who will have to comply.

Payroll update for small businesses (RTI)

Posted on: October 4th, 2013 by Sarah Curzon No Comments
Sarah Curzon, Tax Director, MHA Broomfield Alexander

Sarah Curzon, Tax Director, MHA Broomfield Alexander

Since April 2013, employers have had to report pay, tax and national insurance contributions to HM Revenue and Customs (HMRC) on or before every pay day under the new Real Time Information (RTI) rules.   For many employers this has meant an overhaul of their payroll system, which for some has been a costly and complex task.

However, it seems that it’s not just employers who are struggling to get to grips with RTI.

HMRC are also having problems and underpayment notices are being issued to employers when no fault has arisen.  In some circumstances employers are being hounded for payments and threatened with fines and penalties even though employers were assured that in the first year of RTI no penalty situation should arise.  If you receive a penalty notice from HMRC which you feel is incorrect please do get in touch with a payroll professional for advice.

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RTI Update: Reconciling PAYE

Posted on: September 9th, 2013 by Leighton Reed No Comments

Reconciliation of PAYE is causing concerns and it seems that HMRC are having problems settling RTI in. Underpayment notices are being issued when no fault has arisen.  In some circumstance employers are being hounded for payments and threatened with fines and penalties even though this first year, employers were assured, no penalty situation should arise.

HMRC have recently published a message on their website:

‘We have received feedback that some PAYE schemes have experienced difficulties in reconciling the difference between:

– the tax we say is due, and

– the tax they think is due

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RTI payment dates

Posted on: July 4th, 2013 by Mark Jones No Comments

HMRC issues a reminder that the full amount for each month must be paid on time

The due dates for paying PAYE are not changed by the new Real Time Information (RTI) rules.

Cheque payments need to be received by the 19th of the month following the end of the tax month of deduction, and cleared electronic payments by the 22nd.

Payment in full is the:

  • total amount shown on the Full Payment Submission(s) (FPS) for a tax month, including any corrections or adjustments submitted on or before the 19th of the following month
  • less the amount shown on any Employer Payment Summary (EPS), also submitted on or before the 19th of the following month.

Don’t forget that you can submit more than one FPS for a month and can continue to do so until 19th of the following month. If however you submit more than one EPS for a payroll for a month, later submissions overwrite earlier submissions for that month.

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