Small businesses to struggle with RTI, say MPs

SMALL BUSINESSES will struggle to implement real-time reporting, the Public Accounts Committee has warned.

Under the real-time information (RTI) initiative, employers would send information to HM Revenue & Customs when they run their payroll. All businesses must implement RTI by October 2013.

However, the PAC has warned HMRC that it must develop an “effective approach” for businesses that do not currently have electronic payroll systems.

“Approximately 94% of employees receive earnings electronically, but small businesses without electronic payroll systems and the self-employed do not currently submit monthly data to HMRC,” the report said. “HMRC told us that it is currently identifying how best to include the last 6% of employees (about 1.5 million people) and the self-employed in the RTI system, but the detail of how this is to be achieved remains to be worked through.”

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