Independent cookshop owner Christine Lynn-Thomas hit the headlines last week when she was interviewed in ‘The Sunday Times’ for her views on the new PAYE tax arrangements.
The Sunday Times “>The new system, known as Real Time Information (RTI), started on April 6. It requires employers to report PAYE information to HM Revenue & Customs (HMRC) in real time.
This means that employers (or their accountant, bookkeeper or payroll bureau) must send details to HMRC every time they pay an employee, at the time they pay them (rather than yearly). And they must use payroll software to send this information electronically as part of their routine payroll process
With 13 staff, two cookshops in the Surrey town of Richmond (Kooks Unlimited, which launched in 1989 and sister store The Bakeware Studio, which opened a few doors up in 2010) and an online business, Christine realised the new system would cause extra work. So she decided to outsource the problem to a payroll agent, the newspaper reported on April 7.
“I won’t have to deal with HM Revenue & Customs’ online filing, but I will need to prepare details of my wages every week, which can get complicated,” Christine told ‘The Sunday Times’.
HMRC’s Director General Personal Tax Ruth Owen has said: “RTI is the biggest change to PAYE in 70 years. We appreciate that some employers might be daunted by the change but they don’t need to be. HMRC is on hand to offer help and support and we are taking a pragmatic approach, which includes no in-year late filing penalties for the first year.”
A range of RTI software is available, including free software for micro businesses with nine or fewer employees. Guidance on reporting in real time and hints and tips on avoiding problems when employers start to report PAYE in real time can be found at hmrc.gov.uk/rti.
