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- HMRC Real Time Information
HMRC Real Time Information (RTI)
- The current PAYE system relies on employers assigning tax codes
and deductions to their employees during the year before submitting
this information at year end.
- Real Time Information (RTI) will enable HMRC to collect
pay-related information each time employers run their payroll. Most
companies of 50 or more employees are expected to be submitting by
April 2013, with smaller (<50 employees) and some very large
employers migrating to the system before October.
- 92% of employees receive their salaries through the highly
secure Bacs channel. It therefore makes sense to ensure the
accuracy of pay related information by using this channel to submit
HMRC RTI at the same time as the payment.
Make the RTI
change simple with ePay »
- Initially RTI will be delivered via the Government Gateway or
the Electronic Data Interchange (EDI) channel.
- It is hoped that this will ultimately become a one stage
process where RTI and payment files are delivered simultaneously
through the Bacs channel. This is because EDI is unlikely to be
available after 2017.
- In the meantime, HMRC are looking to match the RTI file to the
corresponding payment via Bacs, using the hash.
ALBACSip users that are confirmed pilot
customers for HMRC RTI should contact us on 0870 081 8250 »
- Employers who currently pay their employees by Bacs, either
using Direct Bacs software or via a Bacs Bureau, will need to
generate a hash to link the RTI file to the payment file.
- The employer's payroll solution will automatically generate the
hash using pre-determined data. The hash consists of a
randomly generated four digit cross-reference; the originating sort
code; the destination sort code and the payment value.
- The hash will be submitted with RTI data
file, via the GG or EDI channels.
- The cross-reference will be included in the
payment file that is submitted via Bacs.
- On receipt of the payment file, VocaLink will recreate the hash
and pass this information to HMRC.
- HMRC will then match the hash submitted from
payroll to the hash submitted with the payment file.
What this means for employers
- Employers will now submit tax data along with their payroll run
- whether weekly, fortnightly or monthly - rather than at year
- Some software upgrades may need to be made. Employers must
ensure that their payroll and payments solutions are able to
- The name, address, date of birth and gender of employees will
be very important so employers should make sure that this data is
clean and correct. We have produced a list of tips to help with the RTI
- Once the changeover has occurred, the time spent on payroll
will be reduced - and HMRC has stated that the payroll process will
become cheaper in the long run, thanks to Real Time
help - our latest software is HMRC RTI compatible and ready to help
save you time and money »
Additional resources from HMRC
introduction for employers | Improving the operation of
PAYE | Improving your