Small firms win RTI reprieve

In the latest relaxation of RTI rules, HMRC has announced that it will exempt small employers with 49 or fewer staff from RTI late filing penalties until March 2015.  Until that date, they will be allowed to submit PAYE information monthly.  "We know from our experience of rolling out of RTI that to ensure a smooth transition for our customers its best to introduce changes in stages.  This will allow us to update our systems and enhance our guidance and customer support as needed.  We know that those who have had most difficulty adjusting to real-time reporting have been small businesses, so this staged approach means they have a little more time to comply with the new arrangements before facing a penalty", HMRC's director-general for personal tax Ruth Owen comments.  The exemption was welcomed by the CIOT as a "positive step", however, it warned that wrinkles remain in the overall system.  It warns that the taxman is guilty of firing off erroneous message to small firms, accusing many of these firms of late filing, non-filing and late payment.  This results in additional form-filling for these business and often requires a lengthy appeals process.