What is RTI: Real-Time Information (RTI) reporting for PAYE? How does it work?

At a glance

Real-Time Information (RTI) means reporting payroll almost in 'real-time' to HMRC. Employers report to HMRC electronically in advance of making any salary or wage payments to employees.

  • Since April 2013 most employers have to report to HM Revenue & Customs (HMRC) monthly under RTI.
  • Reporting is done on or before any payment is made to an employee.
  • Employers may be fined if they fail to file under RTI or make errors in reporting.

RTI concessions history

  • Penalties for error in operating the Off-payrolling rules applies for 12 months from 6 April 2021.
  • On-going: a reporting relaxation for those reporting deemed payments under IR35. This allows late reporting by 31 January following the year of assessment in cases where it is difficult to assess IR35.
  • 5 April 2016 end of the relaxed reporting requirement for micro employers.
  • 19 March 2013: HMRC announced concession to relax the strict timing of submission under RTI for smaller employers. This expired on 5 April 2014.
  • 11 Nov 2012: HMRC allow up to seven days to report payments where real time reporting is difficult or impossible and up to 14 days to report payments of benefits and expenses subject to Class 1 National Insurance Contributions (NICs) but not taxed under PAYE

See 'RTI News' below for full details.


  • Under RTI all employers require an internet connection and RTI enabled software to file PAYE online.
  • Employers with less than 10 employees may use HMRC's free software. Most commercial software may be easier to use.
  • RTI requires reporting at the same time as, or before, each salary or pension payment is made, rather than at the end of each tax year.
  • Nil returns are made.
  • There are changes to what is reported. Forms such as P45 and P46 and the year-end reports P35 and P14 will no longer be filed with HMRC although employers must prepare P45s and P60s for employees.

Under RTI employers are required to make:

  • A Full Payment Submission (FPS) electronic submission report to HMRC before they make any payment to employees.
  • An Employer's Payment Summary (EPS) if during a PAYE month an employer makes any statutory payments to HMRC (Statutory Maternity Payment or Sick pay for example) or suffers Construction Industry Scheme (CIS) deductions, or has not paid anyone.
  • Up to 5 April 2019, Earlier Year Updates (EYU) should be used to correct errors after 19 April following the end of the tax year in which the error was made. If correcting by 19 April, then an additional FPS can be submitted.
  • From 6 April 2019, HMRC no longer require an EYU to correct errors. Instead, an additional FPS should be submitted with year to date figures, which will overwrite the original figures.
  • Employers who use the BACS system for making payments to employees will have to file an additional report under RTI
  • It is not compulsory for employers to use BACS.

Getting started

You need to be online with the correct software and ensure that the data you hold on your employees is complete.

All employers have to:

1. Ensure that their software is RTI enabled.

2. Cleanse the data on their payroll to ensure that they are holding only the current details of their employees.

3. Collect the passport numbers of all new employees.

4. Ensure that they have all the details required to run the payroll before they start. It looks as if it will be complicated to correct reporting errors.

5. This is a fundamental change to PAYE reporting so it will be advisable for all employers and payroll bureau to allow extra time to file payrolls.

RTI Penalties

Penalties under RTI include:

Penalties will be calculated automatically and employers will be able to appeal penalties. It is anticipated that HMRC will not set its computers to deliberately delay in notifying late filing penalties, as it has done in the past for PAYE reporting.

RTI Resources

The ICAEW, ICAS, ACCA and Federation of Small Business have set up a new website: www.payerti.org which will carry guidance.


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