January has got self-assessment tax returns looming large. No sooner is that out of the way than we'll need to look to the next bit deadline, in April, when monthly payroll filing or 'real time information' (RTI) comes into force. The good news about this is that managing your payroll during the following year should take some of the headache out of end of year procedures.
Here's a summary of the how RTI will change your payroll processes:
Because you will be required to submit data on or before payroll, this will mean a simplified Payroll Year End procedure, and it will also affect some normal payroll processes, such as taking on new starters and making employees leavers. For example, employers will no longer have to complete a P46 form when taking on a new employee who doesn’t have a P45, but you will need to obtain the P46 information and complete starter information for the employee’s first payment.
From April this year**, end of year return forms (P35 and P14) or P38A supplementary returns will no longer be needed because you are informing HMRC about all payments made during a tax year every payroll. Under RTI you will submit online a Full Payment Submission, which will detail tax, NICs and other deductions when or before the payment is made to the employee.
Want further advice on RTI? Visit sage.co.uk/rti for more information
** After this blog was published, HMRC announced a "relaxation of reporting arrangements for small businesses". According to HMRC: "Until 5 October 2013, employers with fewer than 50 employees, who find it difficult to report every payment to employees at the time of payment, may send information to HMRC by the date of their regular payroll run but no later than the end of the tax month (5th)."