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Employers may be overestimating their levels of preparedness, ahead of mandatory payroll RTI, KPMG suggests


Almost nine out of 10 businesses (86%) of businesses have started to plan for implementing real time information (RTI) reporting of payroll data to HMRC when it becomes mandatory in April 2013, according to KPMG in the UK.

This is a significant increase from a similar survey conducted by KPMG in March this year in which two thirds of employers had yet to begin to prepare.

But despite almost nine out of 10 respondents saying that they had commenced planning, only a fifth (21%) had conducted a payroll data cleanse, a process, which, according to KPMG, is one of the first and most basic actions to take when preparing for RTI.

Nearly two thirds (65%) said that they had not considered the cost of RTI to their business (another crucial element of the planning process) and less than half (44%) said they were confident that their current payroll could cope with RTI's requirements.

Steve Wade, director at KPMG, said: "It's very good news that so many businesses are starting to plan for RTI but our data suggests that they really are at the very beginning of that process and they quickly need to translate thoughts into actions if they are to be ready in time."

HMRC have recommended that businesses take the following actions to prepare for RTI:

  • Carry out data cleanse
  • Talk to your software payroll provider
  • Review recruiting and payroll process for new employees
  • Talk to relevant stakeholders

Wade added: "With RTI becoming mandatory from next April, employers really do need to start implementation. If their employee data is up to date, they don't operate multiple payrolls, have a low turnover of staff and their payroll provider is ready, the transition may be very smooth. But if this is not the case, they may well need to do some housekeeping before next April to reduce the chance of HMRC rejecting their data submissions and possibly imposing penalties."