RTI is a new way of processing payroll information being introduced by HMRC from April 2013. We’ve summarised the key points to help you understand how these changes will affect your business.
Real Time Information, or RTI, is a new way of processing payroll information. It’s being introduced by HMRC to improve the way that Pay As You Earn (PAYE) information is collected, and will be mandatory for most businesses from April 2013.
As an accredited Sage Business Partner specialising in the supply and installation of Sage 50 Payroll software, we’ve summarised the key points about RTI and how it will affect your business in this article. You’ll also find downloads and links to more information below.
What will RTI involve?
RTI will involve sending information about your employees’ PAYE, National Insurance Contributions (NIC) and student loans to HMRC every time you pay your employees, instead of just once a year with your tax return. The information will be sent electronically, using payroll software such as Sage 50 Payroll.
Why is RTI being introduced?
There are several reasons:
- To make the PAYE process quicker and simpler, especially when employees start and leave your business.
- To help HMRC respond more quickly and efficiently to PAYE errors such as over and under payments.
- To support the introduction of Universal Credits, which will bring all state benefits together into a single payment.
- To reduce fraud and help ensure everyone gets the benefits to which they’re entitled.
- To efficiently provide the Department for Work and Pensions with accurate and up to date information about your employees’ income.
What do I need to do about RTI?
You’ll need to take a little time to understand how RTI works and how it’ll affect your payroll processes; the downloads and links below will help you get to grips with it. Most importantly, however, you must make sure that your employee records are accurate and up to date, including each person’s full name, gender, date of birth and NI number.
HMRC will be checking the information you send against their own records – and problems will arise if it doesn’t match. So it’s a good idea to tell your staff about RTI and stress how important it is for them to give you accurate information at all times.
When will RTI become mandatory for my business?
Businesses with fewer than 250 employees will have to start using RTI from April 2013. It becomes mandatory for everyone else from October 2013. HMRC will notify you about four to six weeks before you have to start using RTI.
What is Sage doing about RTI?
As you’d expect, Sage have been hard at work making sure that all their payroll software is RTI ready and RTI compliant. In fact, they’ve been working closely with HMRC on trialling the scheme before it’s rolled out from April 2013.
If you have a valid SageCover support contract, you’ll receive software updates in good time so you can start using RTI quickly and easily from the required date. Sage are also offering extra training and support on RTI to guide you through everything you need to know – please contact us if you’d like more details.
Can Air-IT help me with RTI?
Yes – as an accredited Sage Business Partner, we’re recognised by Sage as specialists in the supply and installation of the Sage 50 suite of products, which includes Sage 50 Payroll. Our Account Managers have been trained by Sage to offer advice and assistance, so please contact us today for more information, or for product purchases and upgrades.