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Limited awareness of impending RTI remains widespread

February 4, 2013


With a little over 2 months to go until HMRC's Real Time Information reporting of PAYE is introduced by law, business surveys continue to reveal a widespread lack of awareness of RTI or what to do about it.

The mandatory introduction of PAYE Real Time Information reporting for all but the very largest UK employers on 6th April 2013, requires employers to report PAYE deductions and employee earnings at the same time they pay their employees. However with only a few weeks remaining significant numbers of employers appear to be unaware of the imminent changes and their likely consequences.

The problem was first identified at the end of October by the Federation of Small Businesses, which conducted the largest survey of its kind on PAYE Real Time Information polling over 1000 businesses, some 6 months ahead of RTI’s introduction.

In the most comprehensive survey of RTI preparedness undertaken to date, the FSB sampled 1,700 small firms, the FSB findings found only 16% of respondents were fully aware of RTI. Worryingly, the research found more than 60% of firms had received no communication from HMRC about the changes.

FSB national chairman John Walker said he was concerned that the entire RTI programme could fail if the government doesn’t “step up its game” in raising awareness.

HMRC responded to criticisms at the time by saying that employers would simply ignore warnings and information about PAYE Real Time Information if it was communicated to employers too early. However, there has been no significant stepping up of HMRC’s limited information campaign since and as a result, according to HMRC’s own guidance, HMRC risks employers not having undertaken essential checking and updating of their employee records. HMRC’s RTI system depends on the synchronisation of accurate employee data records between employer payroll software and HMRC’s own systems.

Since October a number of smaller surveys commissioned by commercial organisations have published similar findings that limited awareness of the introduction of HMRC’s RTI or confusion surrounding what to do to prepare for it is widespread among small employers. Employers with 49 or fewer staff now employ a majority of the UK working population.

In the most recent survey conducted by Crouch Accounting, 46% of surveyed businesses have never heard of Real Time Information and one in three companies were only “vaguely aware” of RTI with 81% admitting to being unprepared for its arrival.

Steve Crouch, of Crouch Accounting commented: “These new figures clearly show that despite HMRC’s claims that their communications campaign for RTI is on track, there’s still not enough information from the Government about this huge change to the payroll system.”

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