Payroll RTI Returns – What, When and How ?


Payroll RTI Returns – What,When,How?

 

 What is Payroll RTI  ? 

RTI stands for Real Time Information and is the biggest change to the PAYE system since its beginning in 1944, and from April 2013 the way that employers report information to HMRC has changed.

This is the SECOND Blog Post about Payroll RTI. If you missed the earlier Blog Post, take a look at it here.

 What Returns to Submit to the HMRC and when ? 

There are several different types of Payroll RTI Return that you are legally obliged to submit and also some possible Supplementary Returns that you might need to submit as follow:

EMPLOYER ALIGNMENT SUBMISSION (EAS)

Once you as the Employer has received written confirmation of your migration to RTI date, an initial EAS will be required. It is a one-off submission that lets the HMRC know who is or has been employed by you during the current tax year. Before you are able to submit this return, you may need to activate RTI from within your Payroll software.

 FULL PAYMENT SUBMISSION (FPS) 

This Return must be submitted each and every time that your employees are paid, must be submitted on or before the payment date and must include Employee Information, Payments and Deductions, PAYE & NIC, Student Loans & Starter/Leaver details.

  • No longer a requirement to submit a P45 or P46 to HMRC as they will be included in the FPS
  • Casual staff must be placed on hold as if there are not any submissions made within 3 months for an employee, HMRC will close their record
  • Student employees formerly submitted through a P38s will now have to have an individual record and will be included within the FPS
  • New Starters with a P45 will also require to make a selection from Statement A, B or C, which is the same for those issued with a P46

 FULL PAYMENT SUBMISSION ADJUSTMENT 

As part of processing under RTI, you’re required to submit a full payment submission (FPS) to HMRC every time you make a payment to an employee. The FPS should be sent on, or before, the date the employees receive their pay.

There may be times when you need to send a supplementary or additional FPS to inform HMRC of changes to the original FPS that you’ve sent. This may be because you’ve rolled back or recovered a period to reprocess with amended values, or because you need to inform HMRC of an employee’s leaving date which wasn’t included on the original FPS.

 EMPLOYER PAYMENT SUMMARY (EPS) 

As before, you are required to pay HMRC any money owed to them with regards to PAYE, NI and Student Loan deductions. The calculation of this figure does not change under RTI and nor does the method of payment.

However, you may need to submit this extra return at period end but only for those items that are not included on the FPS (see above). If required, this Return must be submitted on or before the date that payment to the HMRC is due.

The conditions that indicate that you need to submit this Return are as follows:

  • Where no payment is due to the HMRC
  • Where there is a Recovery of Statutory Payments (ie.SSP, SMP, SPP,SAP)
  • Where there is NI Compensation on Statutory Payments
  • Where there have been any CIS Deductions suffered (see further specific blog here)
  • Where there has been an Employer’s NIC Holiday
  • Where Advanced funding has been received from the HMRC

IMPORTANT – If none of the above apply, then you will not be required to submit an EPS.

 EARLIER YEAR UPDATE (EYU) 

It’s important that the information you submit to HMRC for RTI is correct. If you submit an FPS and then need to correct a mistake, you can reprocess your payroll and submit an FPS adjustment (see above)

However, if you realise you’ve made a mistake in the previous tax year, and it’s after 19 April in the new tax year, you must correct the mistake and then submit an EYU. This notifies HMRC of any changes in the previous tax year submissions. Unsure how other Payroll software accommodates this but within Sage Payroll, it is covered.NI NUMBER VERIFICATION REQUEST 

Although not strictly a Return that needs to be made, in some Payroll software (Sage Payroll included), there is a feature that can be used to obtain the correct National Insurance Numbers from the HMRC, thus ensuring that your Returns above are not rejected or fail in submission.

 How do you Submit the Payroll RTI Returns ? 

Employers must ensure that they are registered through the Government Gateway at www.gateway.gov.uk for PAYE for employers online submissions and then able to submit from within most Payroll software but you will need to check this with your software provider (definitely possible from within Sage Payroll)

 Need Help ? 

Staff at Harley Grove Ltd are fully accredited on Payroll RTI regulations and specifically on Sage Payroll. We offer one-to-one remote or face-to-face training on Sage Payroll and, of course, including RTI.

WHAT NEXT ?

There have been 2 other Blog Posts about Payroll RTI:

Click here for “Is your Business Prepared for RTI ?”

Click here for “Construction Industry Scheme (CIS) and Payroll RTI”

Look out for the next Blog Post that will give more information about how RTI will make your Payroll Year End easier.

WOULD YOU LIKE MORE INFORMATION ? CALL 01825 766406
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