Since October 2013, all employers in the UK have been required to submit payroll information in real time, known as Real Time Information (RTI). Under this system, employers need to send payroll data to HMRC via the Government Gateway on or before each employee is paid.
The payroll data should include employee personal information, pay details, tax, national insurance, pension contributions, net pay, and additional information such as typical working hours within a Full Payment Submission (FPS).
It is the mechanism that deals with advising HMRC of starters and leavers within an organisation.
Employers must also submit a monthly Employer Payment Submission (EPS) to HMRC to report any reduction in Paye/National Insurance liability including tax suffered/deducted under the Construction Industry Scheme that are otherwise reported outside of RTI.
Employers should be aware of the penalties for non-compliance with RTI requirements. The penalty amounts based on payroll size are as follows:
1-9 employees: £100
10-49 employees: £200
50-249 employees: £300
250 or more employees: £400
HMRC can issue penalties if the FPS was late, if the expected number of FPSs was not sent, or if an EPS was not sent when no employees were paid in a tax month.
For more information and assistance with RTI, please contact our team