RTI Update: Payroll system developers issued with specificationsTuesday, May 3rd, 2011
Developer technical specifications provide first real glimpse of the Real Time Information process
The first draft of the system specifications for Real Time Information (RTI) was issued to payroll software developers on 26 April, about eleven months before the first full pilot is due to start with selected developers and volunteer employers.
The documents are necessarily technical in nature (and may make fascinating reading for those skilled in XML) but they do provide an initial view of how RTI will operate when it is introduced for all employers in 2013.
There will be two “submission channels”, i.e. methods by which RTI payroll data will be sent to HMRC at the time of each payroll run.
- The “Bacs Channel” will be used for employees who are paid using Bacs, whether that is done by direct submission to Bacs by the employer, or indirectly by a third party (e.g. payroll bureau). The RTI data will be sent as part of the Bacs payment file.
- The “Internet Channel” will be used for employees who are paid in any other way. The methods listed are: Faster Payment, CHAPS, Lloyds Bulk Payment, Barclays Corporate Direct Access, Internet/telephone banking, internal bank payments to own staff, other bank grade payments, cash, cheque. The RTI data will be sent at or just before the time of payment using the employer’s existing Internet channel provided in payroll software or on HMRC’s website.
Routine submissions will include all of the information that is currently submitted on forms P45 Part 3, P46, P46(Pen) or P46(Expat) for new starters, pensioners and secondees. Similarly, when an employee leaves, the submission for the final payday will include all of the details that are currently included in the P45 Part 1.
The final RTI submission for each tax year will include all of the information that, under current procedures, is involved in filing P14 and P35 Returns. For example, it will require the employer to answer the standard questions and declarations that currently are part of the online P35 submission, and provide all of the tax and statutory payment adjustment figures.
The specification also makes provision for payments and deductions that fall outside of the normal gross to net calculation, including benefits that are taxed through the payroll (instead of on form P11D) and which may or may not be liable for Class 1 NICs.