Employers Warned As Biggest Paye Shake-up For 60 Years Looms
Almost all employers in the UK are set to receive a letter from the tax authorities next month outlining key changes to PAYE reporting.
The tax authorities unveiled the plans to write to employers in HMRCs latest "Employer Bulletin".
And, according to the employment tax team at KPMG in the UK, receiving this letter is likely to be the first that some employers know of the most radical shake up to the PAYE system in over 60 years.
Between April 2013 and October 2013 virtually all employers and pension providers will start reporting payroll information to HMRC in "real time" ie on or before every payday instead of after the end of the tax year, as is the current situation.
Employers reporting PAYE information to HMRC in real time will play an important role in supporting the introduction of Universal Credit by the Department for Work and Pensions (DWP), which is due to be rolled out across the country from October 2013.
Steve Wade, employment tax director at KPMG in the UK, said: "Moving to real-time information (RTI) reporting in which employers send payroll information to HMRC on or before every payday instead of after the end of the tax year is an enormous change. In the main, the larger employers are putting plans in place, or at least thinking about it.
"But many small and medium-sized businesses are likely to be blissfully unaware of this radical change. If they have up to date payroll software, hold current and accurate employee data and their software provider is gearing up for the more to real-time reporting then they may find that the transition is smooth. But if not, they are likely to face significant problems complying and may incur penalties."
The latest HMRC employer bulletin contains detailed information about the forthcoming change to real-time information reporting, together with some case studies arising from a pilot programme run by the tax authorities with a number of employers. However, each employer will face different issues, so planning early is important.
Wade said: "Employers across the country from the smallest to the largest need to get their heads around what the move to real-time information reporting means for them and how they are going to comply with the new rules. The letters from HMRC next month are just the beginning of the process. They need to have a good look at their current payroll systems and think about the steps they need to take between now and next April."
by: Investor Today Taking Out A Payday Loan: Is It Right For You? How To Buy River Sand Search For Online Voucher Codes To Get Discount While Shopping Discover The Benefits Of Shopping Bras Online Online Shopping Provides You A Great Choice For Summer Wear Social Networking Promoting Online Shopping In India Online Shopping A Form Of Retail Therapy Latest Property Inspection Program For Buyers In Australia Online Shopping Uae Has Diverse Products On Offer You Should Buy All These Minimal Bikinis Buy Local Currituck Congratulates Our 3rd Quarter Prize Winners A Look At Buy Here Pay Here Financing- What Is It Exactly? Buy Diamonds With Knowledge