In 2012 the Government introduced new regulations for payroll providers to report payroll data to HMRC in real time, named Real Time Information (RTI).
This introduced parity across payroll processing and payments, as it was often paid and reported haphazardly.
However, this guidance is still relevant and useful for a new payroll schemes.
When payroll reports are finalised and agreed, an RTI submission named Full Payment Submission (FPS) is made to HMRC, declaring the year to date salary values for each employee being paid for the period. To match this, the bank also make a submission to HMRC, these two figures should therefore match, any discrepancies could cause an investigation.
Some key points to note for business owner managers who operate a payroll scheme;
- Your “process date”, is the day you pay your staff into their bank account.
Where possible, staff should be paid on a fixed date or day of the week/month/year.
- The FPS submission must be made to HMRC on or before paying the staff.
- Penalties can be levied for inaccurate or late RTI submissions. So it is important to stay in contact with your payroll professional.
- Payroll periods follow the tax year, and end on the 5th of the month.
PAYE is due for payment to HMRC (electronically) by the 22nd of the following month.
PAYE is due for payment to HMRC (by cheque) by the 19th of the following month.
- RTI has its benefits too, you can submit regular digital claims to HMRC for the following items, rather than writing to them;
- Statutory Maternity pay
- Statutory Paternity pay
- CIS Suffered
- HMRC have up to date PAYE Liability data, meaning they can chase for payment with knowledge of the liability, rather than waiting until payroll year end.
- Tax codes can now be issued, using “dynamic coding”, which allows HMRC to adjust employee tax codes in-year, and with frequent regularity.
We at Higson & Co offer a comprehensive payroll service, which includes;
- Payslips for each employee, accessible via a secure portal.
- A report on how much to pay HMRC.
- A report on what net pay to pay your employees.
- RTI Submissions.
- Submissions to your chosen pension provider.
- Pension administration.
If you would like to discuss further, please contact us on 01304 381542 and ask for Jade.