From the organisers of the Natural Stone Show

 

 

 

Small companies given six months' leeway to implement PAYE 'real time' changes

, By Eric Bignell

HM Revenue & Customs announced an 11th hour change to its PAYE Real Time Information system – with the scheme just two weeks away from going live on 1 April 2013.

HM Revenue & Customs says the changes in the PAYE reporting system are the biggest in 70 years and that they will make reporting PAYE quicker, easier and more accurate for employers.

Employers will not necessarily agree, especially to begin with as they get to grips with reporting every month. Companies that have not always paid the full amount of PAYE every month but have used it as a way of easing cash flow and caught up towards the end of the year will no longer be able to do so.

In future, employers’ payroll software will need to calculate PAYE and send the PAYE information to HMRC as part of a routine payroll operation. Software is available free from HMRC for small companies.

But now HMRC, recognising some small employers who pay weekly, or more frequently, may need longer to adapt to reporting PAYE information in real time, has announced a relaxation of arrangements for businesses with fewer than 50 employees for the first six months of the new scheme.

Forum of Private Business spokesman Robert Downes says: “Nobody likes last minute changes and this development perhaps hints at something of a panic at HMRC that many, many small firms still aren’t fully prepared for RTI.

“However, this does seem the sensible course of action, because a tax system in meltdown come April is in nobody’s best interest, and no doubt many firms will now be breathing a sigh of relief.

“It will, though, now add another layer of confusion around a subject which is already as clear as mud to many SMEs.

Rob added: “HMRC don’t have a great track record for communicating well with business. Is this yet another example? The suggestion certainly is that awareness levels among SMEs in relation to RTI are nowhere near where they need to be.

“Any business still unsure of what’s expected of them must seek help immediately from HMRC. They aren’t the enemy and they are there to help firms become compliant.”