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Accountancy  •  Bookkeeping  •  Business Services  •  Business Tax  •  Payroll Tax

Get to grips with the detail of RTI

By RJP LLP on 24 January, 2013

The new year always means a load of new resolutions, most of which must have been broken by now. Less obvious as a new arrival are the many new acronyms to get your head around thanks to the impending introduction of RTI (real time information). RTI is the Government’s latest initiative to streamline the collection of payroll related information. From April 2013, detailed online payroll submissions must be made by an employer every time an employee is paid. This replaces the former annual P35 submission made and includes information on PAYE, NIC and Student Loans.

We have already covered RTI a couple of times, looking at what the change means and how to get ready. This month we are going into detail to explain what the 4 main acronyms you will encounter through RTI mean.

1. Employers Alignment Submission (EAS)

EAS is a one off submission which will be used by HMRC to compare company and employee records with existing data held.

EAS consists of:

-       Company PAYE Reference, Accounts Office Reference and Tax Office Number

-       Employee name, address and gender

-       Employee NI number and tax code

-       Employee payroll ID contained in the RTI Payroll ID field

-       Employment start and/or end-date.

2. Full Payment Submission (FPS)

FPS is the primary submission you will make and contains details of all employee payments and deductions made.  Each time a payment is made to an employee, a new FPS must be submitted to HMRC. This submission will be used to calculate how much PAYE and NIC liability is due each month.

FPS contains:

-       Employee payment information

-       PAYE and NIC contributions

-       Starter and leaver information

-       Personal information – employee name and address, NI number, tax code.

3. Employer Payment Summary (EPS)

An EPS submission is only required if there are likely to be alterations to payment liability or if no payment is due for the end of the tax month or quarter.

It differs from the FPS because it relates to specific information that would not be included on the FPS and would impact on the monthly or quarterly payments made to HMRC.

EPS could contain the following types of information:

-       Statutory Payments Recovered

-       NIC Compensation on Statutory Payments

-       Advance funding obtained from HMRC for tax refunds and statutory payments

-       CIS deductions made

-       NIC holidays.

4. National Insurance Verification Request (NVR)

National Insurance numbers are an important aspect of RTI and are the unique identifier used to ensure national insurance contributions made on behalf of an employee are credited to the correct employee.  So everyone on your payroll needs to have one. The NVR submission exists to enable employers to validate an employee’s existing NI number or request that an employee is given one.

For more information on RTI visit the HMRC website. If you have any concerns or questions relating to getting ready for RTI please contact Jamie Spears by emailing js@rjp.co.uk.

 

 

 

 

 

 

http://www.hmrc.gov.uk/rti/index.htm

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