PAYE reforms could backfire for small employers and individuals

Published on 20 January 2012

We still have significant concerns about the impacts of the next stage of PAYE reform particularly for small and very small employers and vulnerable groups such as care and support employers.

For employees and pensioners the success of the proposed real-time information (RTI) system is crucial to ensure they pay the right tax, neither too much nor too little, and also that their benefits are calculated correctly under Universal Credit.

In responding to HMRC’s technical note and draft regulations on RTI, we raise some serious questions:

  • How dependent is the low-income worker on his employer and HMRC to get his monthly tax and reporting correct?
  • How will HMRC ensure early and fruitful use of data and how can integrity of data be assured?
  • ·How will the small, unrepresented employers (particularly those who struggle with online transactions) cope with the administrative burdens of RTI particularly where they are likely to need enhanced support?

To see the full LITRG response, please use the link below.


Contact: Robin Williamson (please use form at