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Useful Payroll Advice

What you need to know about RTI or Real Time Information

RTI or Real Time Information is the biggest change to the PAYE system since it was introduced in 1944. The aim of RTI is to improve the accuracy of PAYE by submitting information electronically every time you pay your employees.

RTI will be compulsory for most employers by April 2013 and all employers by October 2013, and details must be reported each pay day or penalties expected to start at £100 can be charged. The move to make small firms report their payroll in real time will place a huge compliance burden on the smallest firms. Many will have to buy new software to deal with it.

Will RTI apply to me? 

If your salary is below the level at which PAYE tax or NI is payable, you might think that RTI won’t affect you, but it will where the following conditions exist:

  • Your pay is above the NI lower limit (currently £107 per week, £464 per month or £5,564 per year)
  • You’re paid below the NI lower limit, but your fellow directors or employees are paid above it.

In both cases you must report details of your pay to HMRC using RTI. However, your company can only operate RTI if it’s registered for PAYE. If it isn’t you need to act now or you will not be ready in time.

Our advice is to act NOW! 

Where RTI applies, the data must be sent to HMRC using approved payroll software. Free software, called the Basic PAYE Tools, can be used by companies with nine or less employees (including directors). This can be downloaded from HMRC’s website.

Top tips to help you get RTI ready:

All employers with up to 250 employees will have to start operating from April 2013.

Of course, simply splashing out on new software in a bid to adhere to regulations is not the only answer that is available. Get ahead of the game and outsource your company's payroll responsibilities to a specialist provider and avoid the need to spend excess money to meet the new rules.

Why not consider using our managed payroll service?

Using Vanilla Payroll can alleviate the whole RTI headache for you. You will save yourself the cost of expensive software upgrades, the countless hours spent registering and getting ready for RTI plus dealing with the monthly submission reporting, and let's not forget how difficult it can be dealing with HMRC. On top of all this you would have full access to our expert advice and guidance on all things payroll.

Click here for a quick quote to find out how much time and money Vanilla Payroll can save you.