Small businesses are not prepared for the impending changes to PAYE Real Time Information, finds research.

Small businesses are not prepared for the impending changes to PAYE Real Time Information, finds research.

More than three quarters (76 per cent) of small firms admit to having no knowledge of the alterations, according to research by business software provider Sage.

The PAYE system has remained largely unchanged since its introduction in 1944. The adjustment, which has been implemented to improve efficiency and accuracy within HMRC, will for the first time require employers to provide information to HMRC for PAYE, National Insurance and student loans at the point of paying employees, rather than annually at payroll year-end.

By understanding how the changes will impact their operations, firms will be able to prepare ahead of its implementation in order to minimise its impact.
 
Neilson Watts, product manager for People Products at Sage’s Small Business Division says, ‘Small businesses are faced with a variety of different payroll providers who all offer different levels and standards of support. The new changes are not mandated for providers to include within their software, so it is vital that business owners ensure that the appropriate procedures are put in place.
 
‘My advice to any small business who has any lingering doubts around the changes would be not to be afraid to ask your payroll provider for advice, support and guidance to ensure that you and your company are prepared for the changes.’
 
HMRC is piloting PAYE Real Time Information with employers and software providers around the UK from April 2012, with the mandate phasing starting with large businesses from April 2013. From October 2013, all businesses will be expected to include these changes to their PAYE systems.
 

See also: PAYE online and save cash

Related topics: PAYE, Payroll