Budget 2015: Will the end of paper tax returns highlight issues with RTI?

Budget 2015: Will the end of paper tax returns

Some employers and payroll bureaux have been experiencing difficulties with HMRC processing duplicates and demands for extra tax that is not due. Resolution of these “disputed charges” often takes many, many months.

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Commenting on the Chancellor, George Osborne’s, plans to scrap end-of-year paper tax returns in favour of real-time digital tax accounts, Steve Wade, Director in Employment Tax said:

“New digital tax accounts will be welcomed by many who dread the thought of completing their tax return and procrastinate until the January filing deadline.

“One of the many benefits will hopefully be the end of the bottleneck which regularly occurs at this time.  The system, however, will only be as good as the data it displays.  Those who pay their tax through Pay As You Earn will see the information submitted each payday by their employer through RTI (Real Time Information).  Employees will therefore be able to see this information updated throughout the year.

Some employers and payroll bureaux however have been experiencing difficulties with HMRC processing duplicates and demands for extra tax that is not due. Resolution of these “disputed charges” often takes many, many months.

It is disappointing that the Chancellor today did not give any further details of the previously announced review of RTI. In our opinion, it is essential that this review is completed and the current RTI issues resolved because these discrepancies will be displayed to employees under the new system. Vulnerable employees in particular are at risk as they may inadvertently pay tax that is not due.

-ENDS-

 

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Chancellor’s Budget 2015

 

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