RTI: STARTER PROCESS AMENDED

HMRC has amended its guidance on the starter process to help increase accuracy for individuals with a P45 and more than one job. In such cases, instead of selecting statement C and operating code BR, the employer should select statement B and operate the tax code on the P45 – unless the tax code on the P45 is BR, 0T or D prefix – in which case statement C would still apply.

Individuals without a P45 or with an old P45 will continue to complete the starter declaration to confirm their employment situation. The full guidance on the starter process will be updated and available from 6 April 2013 here.

Please be aware the guidance linked above will not be updated to reflect this change until 6 April 2013. HMRC acknowledges that the starter process guidance has gone through several iterations and for 2013-14 says it will accept if an employer’s payroll does not follow this new process.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Read more at www.hmrc.gov.uk >

Posted byAnn TigheinHMRCPAYEPayrollPayroll SoftwarePRSIRTISMEWages

BrightPay 13/14 is Now Available

We are delighted to announce that BrightPay 13/14 has obtained full HMRC recognition for RTI submissions and is now available to download.

Preparing for RTI

From 6th April, all payments to employees must be reported to HMRC using RTI. Although we have worked hard to make your RTI experience with BrightPay as painless as possible, there are a few things you need to do before your first 13/14 payroll run to ensure that it all runs smoothly.

1. Make sure that all employees are included in your payroll before you send your first RTI submission.

   • If you run payroll for both weekly and monthly employees, your first weekly FPS submission will include the employment details for the monthly staff, even if they have not yet been paid.
   • If you have imported from BrightPay 12/13 and an employee joins in 12/13 after the import, make sure you add this employee to your 13/14 payroll.
   • Unlike previous years, you must include all employees, including nannies and domestic staff, casual employees, part-time staff, students working in their vacation and those below the Lower Earnings Limit.
2. Make sure you know your Accounts Office Reference as HMRC requires this to be included in RTI submissions. If you have your yellow Employer Payment Booklet issued by HMRC, the Accounts Office Reference will be on the front cover in the top right hand corner. Here is a useful link on the HMRC website to help you find your Accounts Office Reference.
3. In so far as possible, try to ensure that the information you have entered in BrightPay for each of your employees is accurate. To help with this, we have created a Request Form that you can have your employees complete and return to you.

RTI Examples

It is important that you understand how BrightPay handles Full Payment Submissions (FPS) and in particular your first FPS which acts as an alignment submission. This understanding is best served by a couple of examples.

One of the really nice things about BrightPay is that until an RTI submission is sent, it will be automatically updated with any changes you make to employer, employee or payment details. Let's say you only add your monthly paid employees in BrightPay after already finalising your first week. In this case, the pending first FPS will be automatically updated to include the details for the monthly employees. Similarly, if you discover that the NINO for one of your employees is incorrect, you can simply correct the employee record and the pending FPS will be automatically updated with the correct NINO. You do not have to process the payroll again or prepare the FPS again for these changes to be made.

The same automatic updating applies to other RTI submission types as well (EAS, NVR and EPS). Once they are created and until they are sent, any changes you make to employer or employee information will be automatically applied.

Reporting and Paying HMRC in Real Time: Getting it Right

HMRC have published a useful one page leaflet entitled "Reporting and paying HMRC in real time: getting it right". Download it here.

Any Questions?

We will be delighted to help you with any questions you may have. You can call us on 0845 3004304.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Posted byPaul ByrneinHMRCPAYEPayroll SoftwarePRSIRTIWages

RTI - New Employers may opt out

From 05th November new employers registering with HMRC will automatically join RTI by default.

There will be instances where employers will not want to join RTI immediately therefore employers can opt out.  Reasons for opting out may include;

• The employer already operates other PAYE schemes
• They may wish to use software from a company which is not yet RTI ready
• The employer indicates that they are entitled to claim exemption from online filing and will need to operate PAYE manually. Exemptions will be considered in line with current guidance

These opt outs will only be available between 5 November 2012 and 5 April 2013.

Further information is available from HMRC at http://www.hmrc.gov.uk/manuals/pommanual/PAYE5011.htm

BrightPay 2013/14 will be RTI ready. All necessary functionality to operate RTI for your payroll will be provided in the same simple and user-friendly manner you've come to expect. BrightPay 2013/14 will be available to download for new and existing customers before April 2013. We'll keep you up to date between now and then with the latest information, including an overview of how RTI will work in BrightPay 2013/14.

Please be assured that there will be NO price increase for BrightPay 2013/14 or additional charges for RTI functionality.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Posted byKaren McDarbyinHMRCPAYEPRSIRTI

RTI - the human dimension

One of the biggest concerns for payroll operators with RTI is "What happens if the RTI submission is wrong?".

The regulations state that the RTI file must be transmitted before or at the time of the payroll period update. With most payroll software the RTI transmission and the payroll period update will be part of the one process. However, it can be fairly common for the update to occur and then the operator realises that something was missed, like an overtime amount or some promised bonus. At present (prior to RTI), all the operator has to do is reverse or correct what they have just processed. But how would RTI deal with this?

This very scenario was one of the main issues brought up by us and other payroll software developers during the various RTI workshops organised by HMRC. It would be unworkable if there was some complicated resubmission process. Also, the periodic payroll processing would become very stressful if the implication of getting it wrong every now and again was a lot more work.

HMRC took this on board and conceded that once the year to date figures in the next RTI submission were correct, then the employer's obligations have been met. There is also a procedure in place if an incorrect RTI submission is made for a final pay period (e.g. week 52 or month 12).

The year to date or cumulative amounts are the most important items in the RTI submission with relatively minor importance being placed on the pay or tax figures for a particular pay period.

So, all of you payroll operators can relax. You are allowed to be human now and again!

Bright Contracts – Employment contracts and handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Read more at www.hmrc.gov.uk >

Posted byPaul ByrneinHMRCPAYEPayrollReal time information

HMRC starting to send penalty notices for late P35s

The 2011-12 Employer Annual Returns (P35 and P14s) were due by 19 May 2012. These returns are now over 4 months late and HMRC has started to send penalty notices if their records indicate that they have not yet received your return.

The penalty will be £100 per 50 employees for each month the return is outstanding, from 20 May 2012 to 19 September 2012. So an employer with 50 or less employees will receive a £400 penalty.

Bright Contracts – Employment contracts and handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Posted byPaul ByrneinHMRCPAYEPayroll

Thousands of higher rate taxpayers to receive warning letters from HMRC this month.

Thousands of higher rate taxpayers who have failed to submit tax returns will receive letters from HM Revenue & Customs (HMRC) this month, reminding them that they have only one month left to take up a special opportunity being offered by the tax authority.

Posted byPaul ByrneinHMRCPAYE

Sending letters to HMRC about Self Assessment and PAYE

The Working Together post working group is running a pilot exercise to encourage the use of signpost headings on letters that agents send to HM Revenue & Customs (HMRC) regarding their clients' Self Assessment and PAYE affairs.

These headings will enable HMRC to identify the broad content of a letter, decide whether specific technical input is required and allow them to make sure the correspondence reaches the right area of the department. HMRC hopes that introducing these headings will improve processing times.

Read the HMRC article here.

Bright Contracts – Employment contracts and handbooks.
BrightPay – Payroll & Auto Enrolment Software

Posted byPaul ByrneinHMRCPAYE

Approaching HMRC deadlines

To avoid paying late you must make sure HM Revenue & Customs (HMRC) have cleared funds by the due date. If you pay electronically the due date is the 22nd of the month following the end of the tax month, or quarter to which it relates.

For 2012-13, PAYE month 03 - or quarter 1 - period ended 5th July 2012, the due date is Sunday 22nd July 2012.

Additionally for 2011-12, Class 1A NICs, the due date is Sunday 22nd July 2012.

HMRC must receive cleared funds by Sunday 22nd July 2012.

Bright Contracts – Employment contracts and handbooks.
BrightPay – Payroll & Auto Enrolment Software

Posted byKaren McDarbyinHMRCNICPAYEPayroll

Removal of some occupations listed as being employees for NIC purposes.

'Lecturers, teachers or instructors' are no longer included in the list of occupations for NIC purposes covered by Social Security (Categorisation of Earners) Regulations 1978. Normal employment status rules apply. The CWG2(2012) Employer further guide to PAYE and NICs' Chapter 1 Page 5 has been updated.

Bright Contracts - Employment contracts and handbooks.
BrightPay – Payroll & Auto Enrolment Software

Read more at www.hmrc.gov.uk >

Posted byPaul ByrneinHMRCNICPAYEPayroll