RTI year end process
of 19 April for submitting the final full payment submission (FPS) or employer payment summary (EPS), they updated their processes to begin sending out the checklist and declaration in January 2013. This was to provide their clients with ample time either to respond to the questions / return the declaration or, as is sometimes the case, to ‘lose’ them and request another copy after several reminders and a looming April 19 deadline.
As with the majority of providers they also took the opportunity of this change to once again remind and communicate with clients about the changes that had been brought about as a result of RTI, communications that I feel certain will have continued with regularity as this year has progressed. The one thing that this year of transition has taught us, is the importance of good communications.
So, already the process timetable is
changing and I feel certain that at the time of reading this article you may already be sat back, maybe even feeling a little chuffed, because you too have either already sent out the checklist and declarations to all your clients, or you are in the process of producing them to go with the February run.
Of course, if you happen to fall into the category of a provider who also deals with self-assessment clients, then the need to bring forward this process will not have made your life any easier at all.
What of the P60
Depending on the service offered, the P60 certificates may well have been issued at the same time as the checklist and declarations. Clearly this cannot be the case under RTI processes, as the full picture will not be known until the final payment has been processed. At this point has the changed timetable included delaying issue of P60s as, after all, these still benefit from their 31 May deadline? Depending on the service offered, the traditional ‘year-end’ pack that once so neatly contained everything is starting to look a much slimmer albeit regular communication opportunity.
Earlier year updates
Increasingly we are hearing about the need for an earlier year update (EYU). At this point I have to admit – and maybe I was just extremely lucky – but
...THIS YEAR OF TRANSITION HAS TAUGHT US, IS THE IMPORTANCE OF GOOD COMMUNICATIONS
in my entire payroll career, the majority of which was spent as a payroll provider, I only once recall having to resubmit P14 returns and a cover letter (not even a corrected P35, which goes to show how long ago it happened). I recall to this day how much extra work time that took to process, albeit it was at a time when you could still submit a hand-written P14, so the thought that HMRC guidance is already talking about EYUs as if they may become an almost normal part of tax year-end process is somewhat concerning for all employers but certainly for the payroll provider.
An example of an EYU being needed is where an employee leaving date falls in March of the 2013/14 tax year but is not being reported until April of the 2014/15 tax year (which can be a common occurrence).
Depending on the solutions available through the payroll software this may result in the need for an EYU. What process will be needed to ensure that if this becomes a more frequent occurrence the provider has the resource in place to deal with it at the right time? And how much will that process cost and how will that cost be covered? An EYU can be submitted up to the 19 May 2014 without penalty.
Generic notification service In this ‘year of transition’ it is fair to say that for the payroll service provider already much extra time has been spent making submissions during the year. At the time of writing, any one of three generic notifications (GNs) from HMRC are starting to hit desks and, for some payroll providers, are hitting those desks extremely hard. Though the GNs are electronic notifications, it is commonplace even in the modern office for these to be printed in order to aid research and help resolve whether they do in fact require attention. Each one needs to be investigated to ensure any follow-up action that may be required by the employer is carried-out. Just as with the checklist and declarations, P60s and the EYUs, no GN can simply be ignored.
Missing deadlines You may now be wondering why I have digressed to the subject of GNs when this article is looking at the year-end timetable? Well, aside from the fact that the investigation of these notifications will be competing with valuable time needed for processing the year end communications, their aim according to HMRC is “to provide helpful messages for [HMRC’s] customers alerting them that they may have failed to report or pay PAYE on time”. They have been introduced in advance of the implementation of automatic penalties which are planned to go live from 2014/15. Penalties are a weapon in HMRC’s compliance arsenal and may be incurred for failing to report or pay over the correct remittances when due, whether the final submission for the tax year as now or a failure to report ‘on or before’ without an accepted reason as from 2014/15. This is why payroll providers, payroll software developers, payroll media, payroll training providers and educators are working hard to get their services, products and message right so that the ‘customer’ is not unnecessarily subjected to them.
For the 2013/14 tax year The clear message from HMRC is that the penalty regime exists to encourage customers to comply with their legal obligations. HMRC should not be disappointed if you succeed in getting across the message to your clients that the change to timetables is a very necessary consequence of the introduction of real time processes and that their co-operation is essential to ensure that they do not fall foul of the penalty regime. Late penalties for 2013/14 will not be applied so long as the final FPS or EPS is submitted by 19 April 2014. If an EYU is due, following submission of the final FPS or EPS for 2013/14, no penalties will be raised if it is submitted by no later than the 19 May 2014. Beyond 19 May penalties if they become due will be calculated on the basis of £100 per fifty employees, and will accrue for each month or part-month
PayrollProfessional 37
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56