How are SMEs managing with HMRC RTI compliance?

The introduction of Real Time Information by the HMRC this year meant businesses had to comply with new tax rules. Mark Paraskeva, CEO of SME Division at IRIS Software Group, assesses how businesses are coping with the introduction of RTI six months on. There have been a few technical glitches leading to difficulties making online submissions.

Delays in real time: How are small businesses coping with RTI?

By Mark Paraskeva

“It has now been six months since the introduction of Real Time Information, but it seems that many small businesses are still having issues complying with the new legislation. Regardless of your opinion of RTI, it is here to stay so you need ensure your business is compliant.

In a recent announcement, HMRC revealed that 83% of small to medium sized businesses are successfully making RTI submissions, and approximately 44.5 million payments made between 6 April and 5 May were successfully reported in real time.

However, it has also been revealed that up to 600,000 PAYE schemes are still not complying with RTI. HMRC has already started contacting these non-compliant schemes with the possibility of penalties if they fail to achieve compliance.

Many businesses have reported problems when trying to file submissions using HMRC’s free online PAYE tool. Some businesses have been unable to make submissions due to gateway downtime and other unspecified issues with the software.

As well as these issues, feedback we have received is that since HMRC updated the tool earlier this year, the system requirements have been increased, rendering many employer’s computers incapable of running it. After the update the minimum requirements for HMRC’s tool are:

•    Intel 2.8GHz processor
•    1GB RAM
•    500 MB available hard disk space

Some employers whose computers do meet the minimum requirements have still found that the software is not running smoothly on their systems.

If you have been having issues with HMRC’s free tool, there are other options available. Some commercial payroll software providers have free RTI compliant software. However, these are aimed at smaller businesses with fewer than 10 employees and are only designed to handle a basic payroll.

Employers with more complex infrastructures or more than 10 employees could be better off looking at paid for options. When choosing a software supplier it is important to look at exactly what you will be getting. Choosing a provider who also offers support can be a huge advantage, especially with complex legislative changes such as RTI and automatic enrolment. If you can, it is a good idea to look for a provider who offers a “complete solution”.

On top of paid for training, certain suppliers have also been offering free online introduction courses, whitepapers, advice lines and “health checks” to asses company’s specific needs.
Looking past a few initial teething problems, it seems that the worst of RTI is behind us. Feedback we have received has told us that once you have your software in place and your data has been input correctly, complying with the legislation is little more than an extra click of a button.”