PwC echoes warnings from All-Party Parliamentary Taxation Group on costs and timetable of PAYE reformFollow @PwC_Scotland
The All-Party Parliamentary Taxation Group has raised concerns about the timetable and costs of HMRC's Real Time Information programme, whereby company payslip data will be transmitted to HMRC at the time employees are paid, rather than once a year.
Real Time Information (RTI) is a cornerstone of the long awaited of reform of PAYE, a system which dates back to the 1940s and has attracted criticism in recent years due to tax code errors.
The All-Party Parliamentary Taxation Group's just published 'PAYE at the Crossroads' report highlights a number of potential problems. As well as the investment costs and timescales being likely underestimated, the report flags up that the current 'interim solution' for delivering RTI does not guarantee real time accurate data and is not sustainable.
Michael McCusker, tax partner at PwC in Scotland, said:
"We have long argued the costs and complexities of RTI have been misjudged. Not only are the software costs not captured but the impact on existing business processes is yet to be fully understood.
"Modernisation of PAYE is vital but the rapid pace of implementing the changes could cause the very glitches that the reforms aim to eradicate. There's still a worrying lack of awareness among many employers about what Real Time Information actually is and most of those that are aware of the changes are nevertheless unprepared.
"A recent PwC survey of employers revealed that 80 percent had not yet reviewed the payroll and HR data items required for RTI."
For more information email:
Michael McCusker, head of private client tax, PwC in Scotland
or click here to read The perfect payroll storm - are you prepared?