Implementation of Real Time PAYE could be Impossible

The Institute of Chartered Accountants in England and Wales (ICAEW) has said that the upcoming real time PAYE system may prove “impossible” for many businesses to implement.

This comes despite HMRC recently publishing proposals allowing employers extra time to send information to the department.

Real time information will mean that PAYE will be reported on or before the dates payments are made.

ICAEW said that the changes are “at best unrealistic and at worst, impossible.”

Paul Alpin, chairman of the tax faculty on ICAEW said: “The proposed rules do not take account of the real world.”

“For example, the pub landlord who calls in some extra help on a busy night and who currently runs his payroll once a month may be faced with doing it weekly. That represents an extra burden and an extra cost.”

He added: “I am broadly supportive of the concept of RTI “but the on or before/within seven days rule will add yet another burden to small businesses already struggling to cope. Does HMRC really intend to apply penalties in this situation or will it merely turn a blind eye? Neither would be satisfactory. The only sensible solution is monthly reporting.”

Ricky Steedman