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Real Time Filing

Another well kept secret of HMRC.

 

At the end of this month the consultation period comes to an end. Consultation about the implementation of one of the most far reaching changes to the operation of PAYE almost since it was introduced.

Now that just about everyone is filing online, the next stage is to enforce filing each month rather than at the end of the year. This change is an essential one for Government, allowing it to implement a number of other changes but most critically, PAYE will then become a more instantly collectible debt than at present. This small change is due to come into force in April 2012 - just over 12 months from now.

As every employer knows, if one delays paying HMRC PAYE contributions, one can achieve a cash advantage for a little while and even with the new penalty regime in place, it is still easier and significantly cheaper to borrow from the taxman than the bank.

However HMRC have not been lucky with PAYE systems implementations - last year's millions of incorrect Notices of Codings was their most recent disaster - and there is no reason to assume that this one will work any better. To make matters worse, payroll is going online completely by then and all of the Employers CD Rom support services are disappearing at the same time, and 2012 is also the year when employers compulsory pension contributions is due to start.

Looks like an exciting and tedious time coming up soon.

JohnF

 

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Heather Alexander on February 22, 2011

Goodness, we just have so much to look forward to! Thanks for the advance warning.