HMRC have introduced changes within the PAYE system that will affect all employers within the next year.
RTI is the biggest change in the PAYE system for 70 years.
Employers need to ensure they are prepared to be compliant from April 2013.
RTI is being introduced to simplify the operation of the PAYE system for both HMRC and employers and in addition the information obtained will support the work of the DWP when universal credits are introduced. HMRC expect records and information to be more accurate and make administration more efficient. The system is integrated with the payroll process and this is also expected to improve the issue of in year coding notices for employees. Using RTI employers will be notifying HMRC about tax, NI and other deductions when or before payments are made rather than after the end of the tax year. There will therefore no longer be a need for P35 or P14 forms. Employees starting and leaving processes are also expected to be easier.