Real-time Information and PAYE update

Employer Comments Off on Real-time Information and PAYE update

HMRC are making changes to PAYE so that more people pay the right amount of tax on their income as they earn it. For the c. 41 million Pay As You Earn (PAYE) taxpayers the tax they owe is deducted from their income using information their employer gives to HMRC.

HMRC say the new changes will prevent taxpayers having to wait until the end of the tax year before knowing if they’ve paid the right amount of tax. This new system will offer far more certainty for taxpayers, avoiding unexpected bills or debt building-up. They predict that the majority of PAYE taxpayers who currently over or under-pay tax will end the year balanced as a result of the improvements to PAYE.

What it means for employers:

As HMRC move to the new system, employers and pension providers could receive more tax codes, but the way they are received does not change.

Regular PAYE RTI submissions will continue unaffected, however, it is critical that employers submit accurate data on time using the normal process.

What employers need to do:

  • Apply next tax codes before the next payroll is run
  • Check they have the correct National Insurance Numbers
  • Send FPS files on or before pay day
  • Submit EPS monthly file by 19th of the next tax month.

Should you receive any queries please contact one of our payroll team or Sue Stephens