The Revenue has announced that employers with nine or fewer employees will be allowed to report PAYE information on or before the last payday of the month, rather than every payday until April 2016.
The easement was part of a package offered to help micro employers, which also includes: improved guidance, such as best-practice scenarios; and technology to develop new ways to report PAYE information on or before the date employers pay their employees, for example, by exploring the use of mobile applications.
Paul Aplin, ICAEW Tax Faculty technical committee chairman, welcomed the announcement. He said, “Small businesses are the lifeblood of the UK economy. At a time when they need support to drive economic growth, I would have preferred to see the existing easement, that includes businesses with fewer than 50 employees, extended beyond 5 April 2014.
“The government’s announcement that there will be an extension of the easement on RTI for micro-employers to 5 April 2016 will, however, benefit thousands of the smallest businesses across the country. The new measure will help roughly 85% of employers across the UK, reducing the burdens placed upon them by RTI and freeing up time that can be spent helping to grow their businesses.”
According to HMRC, more than 99% of PAYE records are now successfully being reported in real time. Almost 93% of active employers are using the new processes to send PAYE information about their employees, it says.
In June, HMRC further extended RTI exemptions for certain smaller businesses until April next year, following intense behind the scenes lobbying by the ICAEW Tax Faculty. Under the“easement”, employers with 50 or fewer employees are allowed to continue to report monthly.
Ruth Owen, director general for personal tax at HMRC, said, “We appreciate that for some micro employers it has presented challenges for them to meet the deadlines.
“This package strikes a good balance by ensuring RTI improves PAYE processes while minimising the impact on micro employers and their agents by giving them up to two years to adapt.”