Real Time Information ( RTI )
RTI (Real Time Information) is a new payroll reporting system to be introduced by HMRC during 2013 and refers to the submission of employee pay related information at the time of payment rather than at year end. HMRC's principle aim of the move to RTI is to support the introduction of Universal Credits in October 2013, a government drive that is only possible if pay related information is available in real time.
How will the new RTI system differ from the current system?
The current PAYE system relies on the employer calculating Tax, National Insurance and other deductions for their employees during the year and then submitting this information at the end of each year via the online P35 and P14. Under the new RTI system employers will still calculate the Tax & NIC deductions for each employee (using their Payroll Manager software) but instead of submitting this data once a year to HMRC, they will be required to submit the details at the same time as their payroll run, be that weekly, fortnightly or monthly. The RTI data will be sent to HMRC either via the Government Gateway (as now) or via the BACS system , depending on how a company pays it's employees. End of year returns (P35 and P14) will become a thing of the past.
When will these changes take place?
The RTI scheme is currently in a pilot and testing stage - the current HMRC timeline proposal is that the live scheme will be rolled out from April 2013, initially involving large employers (those with 250+ employees) followed by small and medium sized employers later that year. It is the intention that all employers will be using the RTI system by the end of 2013.*
How will Moneysoft Payroll Manager handle these changes?
For existing users of our Payroll Manager software, there is nothing that you need to do! All of our Payroll Manager products will incorporate the new RTI features from April 2013. There will be no need to re-enter your data, and no need to look for new RTI payroll software! You can continue to use Payroll Manager to calculate your employees pay in the same way that you do now, the only difference will be that you click to file your returns online to HMRC every week or month, instead of waiting until the year end.
Those looking to purchase Payroll Manager for the first time can do so safe in the knowledge that our payroll software is 'future proof' with regards to the future implementation of the RTI system.
* Source HMRC : Improving the operation of Pay As You Earn (PAYE): Real Time Information (RTI)