February 17th, 2013

Only one-fifth of small firms ready for Real Time Information, finds survey

Employers ‘over reliant’ on payroll providers for compliance, adds PwC Only one in five small businesses are prepared for the introduction of Real Time Information (RTI), which is being rolled out from this April, new figures have shown.


Nearly half of small employers (46 per cent) had no knowledge of RTI, while a further 35 per cent said they were only vaguely aware of the forthcoming changes to payroll reporting, found the survey of 500 small enterprises by Crunch Accounting.


New RTI rules mean payroll information including salary, income tax and national insurance will need to be submitted to HMRC monthly rather than annually, and will eventually replace P35s and P14s.

The RTI scheme will be a requirement for larger organisations from this spring, but there will be penalties starting in 2014 for all businesses that are not compliant.


Separate research from PwC also claimed that too many employers were relying on their payroll providers to support their RTI compliance, raising the risk that many companies would not be ready for the April deadline.


PwC’s survey of 200 HR and payroll professionals found that virtually all (99 per cent) said that their organisation needed some level of support to ensure it was ready to start reporting PAYE information to HMRC in real time.


Half of the respondents expected their payroll provider to supply that support – but only one in four believed that their payroll company had prepared their RTI software.


The need for system changes and interfaces under RTI was the biggest challenge for employers (34 per cent), followed by data collection, storage and transmission (24 per cent) and resource constraints (22 per cent).


The majority of employers surveyed were also unsure of how RTI requirements would impact their internationally mobile employees.


“RTI is about more than simply the payroll software; the quality of the employee data and the processes for collecting and maintaining are critical to compliance,” said PwC’s HR director, John Harding.


“Payroll providers need to make it clear to their clients the extent of their capacity to provide support and the associated costs. Employers should not underestimate the challenge of meeting the requirements of both RTI and auto-enrolment by April.”

http://www.peoplemanagement.co.uk/pm/articles/2013/02/only-one-fifth-of-small-firms-ready-for-real-time-information-finds-survey.htm