11 February 2014
Draft proposals ease employers’ RTI reporting burdens but have consequences for UC
The draft Income Tax (Pay as You earn) (Amendment) Regulations 2014 extend the relaxation of the reporting deadlines for small employers to submit PAYE information to HMRC, under the Real Time Information (RTI) scheme.
Whilst this is welcome from the perspective of small employers, there is clear concern that delays in reporting RTI earnings information could adversely impact the universal credit awards of their employees where wages are paid in one assessment period and reported in a later one.Even a claimant who works the same number of hours and gets the same amount of pay each time could be subject to large fluctuations of universal credit as a result of employers reporting RTI information late. This could have serious consequences for universal credit claimants not only because it is extremely confusing, but also from a budgeting perspective.
For more information and response from the Low Incomes Tax Reform Group, see Real Time Information (RTI): legislative changes from the LITRG website.