The consultation on penalties associated with the real time information (RTI) regime suggests that HMRC is expecting a large number of penalties. Rather than looking at how to punish people for getting it wrong, it would have been better for HMRC to iron out some of the many remaining issues surrounding RTI to help people get it right. The new universal tax credit will use real time data about earnings to adjust benefit entitlements. Consequently by October 2013 all employers and pension...

The proposed statutory residence test should give greater certainty and less scope for interpreting the rules by taxpayers, advisers and HMRC. Thresholds have increased, but not as much as many would like, and some, no doubt, would prefer a pure day count test but that has been rejected. Record keeping remains crucial. The addition of transitional rules is an improvement and the abolition of ordinarily residence in general a simplification. More than 75 years ago the Income Tax Codification...

Real-time information (RTI) is the biggest change in pay as you earn (PAYE) since 1944. Some 1.4 million employers have to be ready for its implementation in April. There are five practical steps for employers to follow to be ready. First, they need to know their start date. The 6 April is a Saturday, so an employer’s first RTI submission may be its second payroll run. Read more here. Second, employers must know their new starter process. After their start date, they will not be able to...

The dream behind the introduction of real-time information (RTI) was that it would make PAYE accurate, collect tax more efficiently, and reduce the level of contact between taxpayers and HMRC. Has that dream materialised? The key achievement of RTI is that nearly all employers report PAYE data monthly or more frequently, but this should not be the only measure of success. More investment is needed to make RTI a success for all taxpayers. The dream The original proposals for the improvement of...