Both the Institute of Chartered Accountants In England and Wales (ICAEW) and the Association of Taxation Technicians (ATT) have asked HMRC to consider postponing next April's changes to the employee benefits and expenses reporting systems.
There are growing concerns over IT systems, the lack of final legislation, postal delays and lack of publicity.
HMRC's consultation, "Draft legislation: review of employee benefits and expenses" has now closed. HMRC's proposed new employee benefit and expense system is due to commence on 6 April 2016 and all employers who pay staff expenses or benefits will need to address the new changes and impliment new systems, including making applications to HMRC in order to use scale rates, (see Employers' What's On - from 6 April 2016).
The ICAEW and ATT are the first of the professional bodies to publish their responses.
Voluntary payrolling of benefits
The ICAEW and ATT have requested that the implementation of benefit payrolling be delayed, due to significant concerns over the readiness of IT systems. Legislation is yet to be finalised, and HMRC will need to produce definitive software specifications to internal and third party developers and processors in time for software to be designed, fully tested and installed.
Both bodies have raised concerns that the 6 April 2016 deadline allows little time for all of this, and refer to ongoing issues with RTI compliance two and a half years after its introduction.
The ATT acknowledge in their response a promise made by HMRC to remove penalties for the first two years which might encourage employers to make an earlier entry into the voluntary payrolling if HMRC make this a more public announcement.
Exemption for paid and reimbursed expenses: transitional arrangements
ATT have expressed concern over the requirement for employers to reapply to HMRC for permission to continue to use bespoke scale rates which have already been agreed.
Given that HMRC have yet to finalise or publish details of the application process, and based on their current record in turnaround rates for post, ATT have indicated that it is unlikely that employers will have time to make their application and receive their permission before 6 April 2016.
ATT were also critical of the lack of publicity as to this requirement for employers to re-apply and have sought assurance from HMRC that employers who are not aware of their obligations, or who are unable to receive the required permission in time are not dealt with harshly.
The ATT response in full can be accessed via their website www.att.org.uk
The ICAEW response in full can be accessed via their wesbite www.icaew.com
