PLEASE NOTE: The charity TaxAid advises only those people on low incomes whose problems cannot be resolved with HMRC.

Real Time PAYE information

Employee tax codes and National Insurance

“Real Time Information” means that employers and pension providers will tell HMRC about PAYE payments at the time they are made – as part of their payroll process.

Payroll software will collect the necessary information and send it to HMRC on-line. This will make it unnecessary for employers to make the usual end of tax year return. But employers will still need to give their employees an annual summary of their income and tax paid for the tax year (P60), as well as a note of taxable benefits in kind provided to the employee (form P11D).

There are changes to procedures for joiners and leavers. Employers will no longer send copies of form P45 to HMRC, but employee will still be given form P45 to take to their new employer.

It is just as important as ever for employee to check their tax codes.

There are very few exceptions to RTI – one is that employers who have no employees earning above the lower earnings limit for PAYE (£112 a week in 2015-16 and 2016-17) and no other reasons for deducting PAYE (such as an employee having two jobs) do not need a PAYE scheme and so are not covered by RTI.

For more information on RTI, see the Gov.uk website at https://www.gov.uk/business-tax/paye