Around a quarter of small businesses are unaware that the Pay as You Earn (PAYE) system is going to dramatically change next April.
Real Time Information (RTI) will see the introduction of a live system, where payroll information will be submitted when employees are paid. Under the current system, HMRC only gains employee’s tax figures at the end of the financial year.
A poll of 1,700 small firms found that only 16 percent of them considered themselves up to speed over RTI. 25 percent of respondents were completely unaware that the new scheme was being introduced.
John Walker, the chairman of the Federation of Small Businesses, said the survey showed a worrying level of ignorance, saying: “We’re concerned that it could flop if the government does not step up its game in communicating the changes.
“There are a number of steps that a business must complete before they can provide real time information to HMRC so it is critical that those affected know about it. Of the very small number of firms that are aware of the change, 30 percent have to buy new software for their business. HMRC needs to act now so that all small firms can prepare their business as they only have six months in which to do it.”