RTI exemptions extended into 2014

THE TEMPORARY RELAXATION of real-time PAYE reporting rules has been extended to April 2014, HM Revenue & Customs has announced.

Real-time information sees PAYE reported on or before the date payment is made, while changes will be reported as and when they occur, rather than at the end of the financial year.

Although the system commenced in April, following criticism from stakeholders and institutes, allowances were made for businesses with fewer than 50 employees, allowing them to continue reporting their payrolls monthly until 5 October while they prepare.

That deadline has now been pushed back until April next year, meaning “businesses will not be required to change their approach halfway through the tax year”, HMRC said.

As with the current relaxation, businesses are still required to report through the new system, but are able to do so once a month, rather than each time they pay their employees.

Currently, more than 1.4 million employer PAYE schemes are now reporting to HMRC, with around 83% of SMEs and 77% of micro businesses using the system.

ICAEW tax faculty chair and AC Mole & Sons partner Paul Aplin said: “I welcome the decision by ministers to extend the RTI easement to April 2014 to give HMRC and DWP time to look at the specific problems on or before reporting poses for the smallest businesses.

“It is vital that this issue is dealt with in a way that avoids adding extra burdens to an already over-burdened section of the business community and the announcement shows that government is alive to that. “

HMRC director-general for personal tax Ruth Owen added: “The roll-out continues to exceed our expectations. I am delighted that 83% of SMEs and 77% of the smallest businesses are already on board. We will now write to the minority of employers who are not, to establish how we can help them meet the requirements of reporting in real time.”

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