The Forum of Private Business (FPB) is urging small firms who are not ready for the biggest change to the pay-as-you-earn (PAYE) tax system since the 1940s to act now.
The new system known as RTI (Real Time Information) will come into force on 6th April, at which point all firms that employ staff, regardless of numbers, need to have new payroll software installed.
While HMRC has promised an easy ride for firms that do make mistakes using the new system, and has even made a last minute temporary change allowing concessions for certain small businesses that pay staff weekly, the FPB has said firms who’ve taken no steps at all to be ready for RTI could well find themselves in hot water with the Revenue.
“It’s quite clear that there are businesses out there still not ready even at this late stage. The message we would like to get out there is that it’s still not too late to get on board for RTI – the ship has not sailed,” said the FPB’s head of policy, Alex Jackman.
“It can seem a daunting prospect to small firms, but it’s just not an option to do nothing. Better to act now than have a phone call from an unhappy tax man after 6th April.”
A snap poll carried out this week has shown with just a few working days left until RTI launches, 18% of firms are still classifying themselves as not prepared. The study also revealed 60% were ready, with the remaining 21% saying they employ no staff so RTI is not relevant to them.
The FPB’s financial specialist, Rachel Andrews, who has been working with HMRC closely for the past two years on an RTI pilot scheme, said: “If I had any last minute advice for businesses it would be to have all the information you need such as employee addresses, dates of birth, and the correct NI numbers ready to go.”
Small firms still needing advice on RTI should contact HMRC directly for guidance on how to become compliant.
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