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HMRC’s ‘Basic PAYE Tools’ can’t file RTI

May 8, 2013


HMRC’s own software for filing RTI, Basic PAYE Tools, is unable to report RTI. Users of the software application, made available by HMRC free to businesses with nine or fewer employees, have been experiencing problems when attempting to report RTI via the Government Gateway.

Up to 140,000 businesses rely on Basic PAYE Tools to ensure compliance with their RTI reporting obligations.  Those affected experienced their submission getting stuck at the ‘initialising submission’ stage.  Their submissions have not been sent to HMRC, leaving them technically in breach of their obligations to report RTI.

HMRC themselves in technical guidance to users on their website, updated as a result of the problems, acknowledged: “You will see a warning that failure to submit a Full Payment Submission (FPS) each time you pay an employee can result in financial penalties. We can confirm, however, that no penalties will be issued as a result of this.”

HMRC’s revised guidance notes on BPT are available here.

Users were advised by HMRC’s online recommendations to uninstall and then re-install Basic PAYE Tools using a standard installation rather than a custom one to try to resolve the problem.

HMRC have stated that the problem with the Basic PAYE Tools is due to a missing Windows registry key rather than with the software itself.  However, as the registry key is essential to the full operation of the software including successful submissions of RTI Full Payment Submission returns, the oversight is an embarrassment to HMRC. 

HMRC’s guidance notes admit, “[We] have identified this problem [is] due to a missing component of Windows (ie the 'UTC' registry key)… we do not know why it was removed.”

HMRC are currently working on an update to the Basic Payroll Tools which will work around this issue. 

The update, due at some point in May, will come too late for some employers to report RTI from the start and ensure their PAYE account at HMRC accurately records their liability to PAYE. However HMRC have advised employers to pay their staff as usual and continue to run their payroll through the BPT, in the meantime.

HMRC Basic PAYE Tools, also known as ‘BPT’, calculates PAYE and NI contributions for the employer and aims to provide a complete RTI compliance solution but is not a complete payroll software package.  It does not, for example, produce payslips or record deductions which are not PAYE-related and is limited to nine employees.

George Bull, Chair of Professional Practices Group at Baker Tilly, the national accountancy firm, commenting separately on BPT said:

“HMRC need to keep the IT industry onside if they are to deliver a digital future, and that’s why the basic PAYE tools don’t do simple payroll tasks such as produce payslips. Instead, it permits micro-employers to meet their reporting obligations such (ie those who do manual payrolls). But it won’t replace payroll software since free real payroll software from HMRC would cut over 1.2m SMEs out of the payroll software market. The software houses might have a few cross words to say about that…”

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