Real Time Information (RTI)

Virtually all employers will have to start reporting payroll information to HMRC in Real Time from April 2013. Businesses should have received letters and/or flyers from HMRC telling them to start preparations for RTI. We are currently updating our systems to ensure this process runs smoothly for all our clients and will contact them early in the new year with further information. In the meantime these are some of the changes that will affect the information we will need from you.

  • We will need to ensure we have up to date, correct information about all your employees. The data will be matched with HMRC records on the first RTI reports. In January we will supply you with a list of the data held in our payroll system for checking. Please report any corrections required as soon as possible so that we provide HMRC with clean data. Once RTI reporting commences it will be vital to have correct full names, addresses, dates of birth, current gender and National Insurance numbers for all employees.
  • All employees must be put on the payroll on or before payments are made – this includes employees who earn less than the Lower Earnings Limit for National Insurance that are currently reported at year end on form P38(A).
  • Students will no longer be able to complete P38(S) and should complete P46 as normal employees.
  • All new employees must state their ‘employment situation’ by ticking boxes A, B or C on form P46 – even if they have provided a P45. Box D must be completed if Student Loan deductions are to be made. Please still send us any P45’s you receive from a new employee but we will need a completed form P46 (or equivalent) as well.
  • The required data fields for RTI include ‘hours worked’. We will need to be advised which of the following categories your salaried employees fall within.
    • Up to 15.99 hours per week
    • 16 to 29.99 hours per week
    • 30 or more hours per week
    • Other
  • HMRC will calculate the amount of Tax & NI due to be paid in a tax period from the RTI returns submitted. We will adjust for recovery of statutory payments such as SMP but you will have to inform us of adjustments required for CIS deductions suffered or agreed NI holidays.
  • Payments to employees – Payments made by BACS or other electronic methods will be picked up by HMRC and matched with RTI returns made from payroll. If you pay your employees by cash or cheque please ensure that the payment matches the data on your payroll reports and that any other payments made are reported to us so that we can update HMRC records.
  • Year End – although there will no longer be ‘year end’ reporting as information will be supplied to HMRC every time employees are paid, the statements and declarations currently authorised on the form P35 will have to be sent to HMRC on the final payroll run of the tax year. We will include this information on the BACS authorisation request on the final payroll run to ensure this process is completed in time.