It seems the transition to RTI has been as smooth as silk, with record numbers now reporting real time data to HMRC
It’s hard to argue that the switch to real time information (RTI) isn’t one of the most significant changes to the tax system in more than half a century. But whilst there may have been wobbles for a few businesses in getting ready for the switchover, it seems a huge number of UK enterprises have taken the change in their stride. HM Revenue & Customs (HMRC) has revealed that more than 1.4 million enterprises' PAYE schemes now report in real time.
According to its figures, 83% of small- to medium-sized enterprises (SMEs) and 77% of micro-enterprises now report their PAYE data in real time. In total 44.5 million payments were reported in just a single month, between April 6 and May 5. Four-fifths of these were reported on or before a payment was made and over a tenth were reported within six days of payment, which was deemed a reasonable time period for those businesses that were experiencing minor difficulties with the system.
In part, some of the transition has been eased by the relaxation of reporting rules for businesses under 50 employees, allowing small businesses that pay more than once a month to still file and submit their information at the end of the month. In light of this – and taking into account feedback of stakeholders – HMRC has announced that it will be extending the relaxation from its original closing date in October this year until the close of the tax year in April 2014. This is intended to smooth the final shift for the UK’s smallest businesses and give HMRC the chance to assess whether there are individual circumstances it may need to cater to in the long term.
HMRC’s director general for personal tax, Ruth Owen, commented:
“The roll-out continues to exceed our expectations. I am delighted that 83% of SMEs and 77% of the smallest businesses are already on board. We will now write to the minority of employers who are not to establish how we can help them meet the requirements of reporting in real time.”
It’s reasonable to be a little cynical when the government announces a major overhaul of a bureaucratic system; often it spells several years of teething problems and egg on a fair few faces. But in this case, it seems the government and HMRC have come up trumps.