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HMRC Debt Management not waiting for RTI corrections

December 17, 2013


A report has emerged today revealing that HMRC’s Debt Management and Banking department is incorrectly pursuing employers for PAYE which is “unpaid”, without waiting to determine whether they are chasing the correct amount.  Current RTI guidance states that if there is a correction to be made to a Full Payment Submission, for example an amount of net pay to an employee has been incorrectly reported, the employer (or their agent) should make the correction in the next FPS.  This means that DMB are pursuing a number of employers for amounts of PAYE which have not yet been updated by a corrective FPS.

An HMRC spokesman, quoted on the Payroll World website, said that employers may be contacted by the DMB department where there appears to be an underpayment of PAYE on their account because HMRC would be unaware that a correction needed to be made until they have made contact with the employer.  The spokesman went on to say that if the employer does inform HMRC, and has paid the correct amount, HMRC will “defer collection and wait for the next monthly RTI submission to arrive to correct the charge.  We understand that this is a year of transition for customers and for HMRC and where the underpayment is due to an error or misunderstanding of the process, we aim to explain what to do for next time.”

Payroll World reports that the problem of DMB incorrectly chasing employers has been exacerbated by an issue related to the HMRC system maintenance which was carried out in October.  Some employer RTI submissions, received while the system was shut down, were not processed once the system came back up, meaning that incorrect information was being displayed on the employers’ Payments and Liabilities viewer and some estimated charges were incorrectly sent to employers.  An HMRC spokesman said that the problem was caused by an “enhancement” to RTI which was put in place in October, but that a “successful fix has been implemented and the data started to flow through to L&P viewer by 10th of December.”

This issue of held submissions not being processed in a timely manner and resulting in employers incorrectly being chased by DMB for sums of PAYE has implications for HMRC disaster recovery plans.  In its July 2013 report on RTI, the National Audit Office said that HMRC could hold submissions in a queue in case of catastrophic system outage and then process the queued submissions in order to ensure that the PAYE system could be recovered.  The fact that some submissions failed to be processed after the planned system maintenance casts doubt on whether queuing submissions is an effective or reliable system for safeguarding the processing of PAYE, a concern also raised by the NAO in July.

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