Tuesday 15 January 2013

RTI - The Straw That Breaks The Camel's Back

With the deadline for Real Time Information (RTI) looming ever closer Julie Palmer, a partner at Begbies Traynor, has warned that the new system (coupled with HMRC's more "assertive" approach to tax debt) may tip some companies over the edge.

She is quoted in the Telegraph:
"We don’t know if there will be political pressure to support struggling companies or to be tougher on them and collect outstanding taxes. But what this will give HMRC is the visibility to spot arrears more quickly and to react more quickly.” 
She added that the change is “one of the most fundamental changes to the PAYE tax system since 1944”.
At a time when businesses are already feeling the strain, the potential for quicker demands of additional payments could potentially push them over the edge."
Additionally companies will need to invest in new payroll software, or update their current systems to comply with RTI; these costs have to be borne by the companies.

Alarmingly around 25% of companies recently surveyed are "blissfully unaware" that RTI is coming.

There will be tears before bedtime!

Tax does have to be taxing.

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  1. Considering these businesses are taking the money from their employees pay cheques why is it a bad thing that hmrc will be able to chase paye arrears quicker?

    also, when a debt is pursued quicker it doesnt have the the chance to grow or incur interest or penalties

    1. As long as the information is up to date and they are chasing the right amount of money at the right time?

      Do you have that much confidence either in their IT or their ability to get the figures right? Their track record is appalling and the ability of the system to be able to perform properly is very low.

      Do you work for them - be honest now, big bruvver is watchin'!?