11 September 2023

HM Revenue and Customs (HMRC) has put out a new consultation seeking views on some draft regulations. There are two regulation amendments proposed, one for income tax and the other for social security (National Insurance).

Under current rules, salary advances should be reported to HMRC via RTI when they are processed and the usual contractual payment than also reported. The proposed amendments will change this requirement to only need the contractual, main payment to be reported in full.

This is stated to reduce administrative burden, reducing the number of RTI submissions needed, as well as assisting with HMRC processes such as PAYE coding and universal credit errors.

Within the February employer bulletin, HMRC stated:

Employers who are currently reporting salary advances on or before the contractual pay date may continue to do so until new legislation is in place.

Keep an eye out for updates from the policy team where we will want your opinions to inform our consultation response.

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