Is your business struggling with getting to grips with Real Time Information reporting changes?
Perhaps your problems have been compounded because you missed the January tax return deadline? Well if either of those issues is affecting you, then you can take some comfort in the fact that you’re not alone. Indeed, so many businesses are facing the same problems that HMRC has decided to give employers extra time before introducing penalties. That decision is certainly one that most accountants would applaud.
So what is HMRC proposing? HM Revenue and Customs (HMRC) has confirmed that it will stagger the commencement of penalties after listening to customer feedback on Real Time Information (RTI) reporting changes. Normally penalties for the new automatic in-year PAYE can be served for late filing, late payment and in-year interest. These penalties were due to start from 6th April 2014. However under HMRC’s new staggered system the only penalty that will apply in April 2014 will be for in-year interest on any in-year payments not made by the due date.
The reason for this leniency is due to changes to RTI reporting.
The amendments to Real Time Information reporting have meant that many employers have had to learn and adapt to new ways of managing their accounts. Unfortunately in some cases this has led to late payments and late filing with the consequential penalties. The new staggered approach will give employers extra time to adjust to the changes. Most accountants would probably agree that this flexibility is definitely needed.
So how will the new schedule look and what will the new penalties be?
April 2014 – in-year interest on any in-year payments not made by the due date.
October 2014 – automatic in-year late filing penalties.
April 2015 – automatic in-year late payment penalties.
The return to reporting tax deductions when payments are made, rather than after the end of the tax year, enables the tax system to better ensure the right tax is being taken at source and is designed to reflect the changing nature and fluidity of the 21st Century labour market.
HMRC’s Director General for Personal Tax, Ruth Owen, commented:
“The introduction of RTI is going extremely well for the majority of employers but there are still some who need a bit of time to adapt fully to the changes. This additional time will give us the opportunity to ensure that improvements to our internal systems are working, to learn from them and to provide better customer support to employers who need more time to adapt.”
If your business is experiencing problems with RTI, then Steven Glicher accountants are here to help you. We can file all of your year-end and in-year returns on your behalf with HMRC and provide you with P60s to distribute to your employees. We can help you manage the migration to RTI and all the reporting changes that it involves, leaving you to concentrate on managing and growing your business. If you would like clarification on this matter or would like to discuss any other issues relating to small business tax advice, then give Steven Glicher accountants a ring on 0161 485 8007