RTI switchover: Computer says no until 6 April

HMRC has been trying to resolve a logjam that is likely to occur when real time information (RTI) filing gets under way in earnest in early April.

As is traditional at the turn of the tax year, HMRC schedules several days of downtime for its web gateway to update its mainframe computers so with new rules, rates and functionality. Doing the work at another time would cost too much in extra contractors’ fees.

With Easter falling on 31 March, and millions of companies under orders to start filing their RTI submissions from 6 April, the potential for chaos and frustration is particularly acute in 2013.

In response to pressure from professional bodies and software suppliers, HMRC and its contractors have undertaken to complete the job between 3-6 April. And nobody will be able to submit RTI returns until the overhaul is complete.

Those already filing under the RTI pilot scheme will also be affected as the validation tests for 2013-14 will be different to the ones that are currently being applied.

There is no question of anyone getting caught by penalties, as HMRC has vowed not to levy penalties for late/inaccurate RTI submissions to HMRC until 2014 (except for the final payment due each year, for which the penalty regime will be the same as the one currently operating for P35/P14).

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Comments
carnmores's picture

any guesses as to what will happen

carnmores | | Permalink

get your fans ready!

mr. mischief's picture

No surprises here    2 thanks

mr. mischief | | Permalink

I hope I am wrong but I expect RTI in general to make the news for all the wrong reasons as the year progresses.

RTI

teresaweezer | | Permalink

I am not usually one to promote HMRC as dealings with them are usually frustrating to put it politely.  However, as a payroll bureau we elected to go onto the 'soft launch' for RTI and I have to say, it has worked very well so far.  I agree that it is ludicrous for HMRC to have computer downtime right on the year-end.  In this world of technological advancement, one would hope that HMRC could get their act together.

I'm afraid I shall be old and grey when that happens, by which time I shall be on the brink of a happy retirement!

carnmores's picture

so no time soon teresa

carnmores | | Permalink

:-)

John Stokdyk's picture

PS - Their hands are tied on this    1 thanks

John Stokdyk | | Permalink

As is inevitable in situations like this, there is a temptation to blast HMRC for the situation, but most of those who I've talked to about it have accepted this SNAFU as a by-product of the £10bn ASPIRE outsourcing contract HMRC has signed up to. It's way too late to replay the arguments on that one, but the deal has locked HMRC into a contractual straightjacket where it gets two enterprise system upgrades a year, and anything beyond that is subject to extra charges from the contractors. And you can imagine how they would be structured.

HMRC's ageing IT infrastructure has been a deadweight for years, and the department is striving to overhaul it to cope with the demands of universal online filing, but the people charged with implementing that change didn't design the original systems and as the government throws more changes and innovations at it like iXBRL and universal credit/RTI the situation is going to get more and more logjammed.

So when you want to slag them off, at least give them a bit of leeway for the constraints under which they have to operate.

wish i could john...    1 thanks

justsotax | | Permalink

but its always someone elses fault....which to me is no answer.  

 

Do you think when the local payroll bureau was told that its current payroll software couldn't operate RTI that they told their clients that they were closing up (well i guess some might of) - no they chose another package....will it be at extra cost...possibly but then they will try and find a different way to deal with things.

 

Perhaps it actually makes things even worse, that the Revenue actually now that this was going to be a problem and haven't found a solution (shockingly even in the public sector you are allowed to come up with ideas to resolve problems rather than just sitting back and just saying 'our hands are tied').....

 

and breath.....

issues checks or cheques?!

Exector | | Permalink

issues checks or cheques?!

John Stokdyk's picture

@Exector - whoops!

John Stokdyk | | Permalink

Sorry if my American upbringing sneaked into the article. Copy has now been corrected.

Nick Graves's picture

If nothing can be done, they should therefore be doing nothing    1 thanks

Nick Graves | | Permalink

John Stokdyk wrote:

As is inevitable in situations like this, there is a temptation to blast HMRC for the situation, but most of those who I've talked to about it have accepted this SNAFU as a by-product of the £10bn ASPIRE outsourcing contract HMRC has signed up to. It's way too late to replay the arguments on that one, but the deal has locked HMRC into a contractual straightjacket where it gets two enterprise system upgrades a year, and anything beyond that is subject to extra charges from the contractors. And you can imagine how they would be structured.

HMRC's ageing IT infrastructure has been a deadweight for years, and the department is striving to overhaul it to cope with the demands of universal online filing, but the people charged with implementing that change didn't design the original systems and as the government throws more changes and innovations at it like iXBRL and universal credit/RTI the situation is going to get more and more logjammed.

So when you want to slag them off, at least give them a bit of leeway for the constraints under which they have to operate.

Nice one: I haven't seen SNAFU for some time - ROFL!

To be honest, if HMRC gave maybe an inch of leeway in the other direction & dropped the take, take, take attitude a bit, we might have an ounce of sympathy. But they don't; so we haven't. Well, maybe for the poor HMRC wage slaves having to cope with the fall-out from this, but not for the dis-organisation per se. And there'll be plenty of millions of poor wage slaves suffering on the other side too, for balance.

And as for the Polyingticiunts/Civil Serpent retards who got HMRC in this mess, repeatedly signing up to badly-negotiated contracts whilst demanding more ludicrous new implementations; if they had an ounce of decency, they'd all have topped themselves by now instead of being quietly moved sideways to the next gravy train of incompetence.

But they don't; so they haven't.

I can't really do anything but try to see the funny side of the impending train wreck...

 

 

 

 

 

 

 

 

 

TomMcClelland's picture

Sorry John, I have to disagree...    1 thanks

TomMcClelland | | Permalink

John Stokdyk wrote:

As is inevitable in situations like this, there is a temptation to blast HMRC for the situation, but most of those who I've talked to about it have accepted this SNAFU as a by-product of the £10bn ASPIRE outsourcing contract HMRC has signed up to. It's way too late to replay the arguments on that one, but the deal has locked HMRC into a contractual straightjacket where it gets two enterprise system upgrades a year, and anything beyond that is subject to extra charges from the contractors. And you can imagine how they would be structured.

HMRC's ageing IT infrastructure has been a deadweight for years, and the department is striving to overhaul it to cope with the demands of universal online filing, but the people charged with implementing that change didn't design the original systems and as the government throws more changes and innovations at it like iXBRL and universal credit/RTI the situation is going to get more and more logjammed.

So when you want to slag them off, at least give them a bit of leeway for the constraints under which they have to operate.

I can't agree John. Shutting down the systems for days at the busiest time of year isn't acceptable and never has been. For whatever reason. If it is expensive for HMRC to sort that out then they just need to pony up (our) cash unfortunately. At the moment the costs of that particular piece of incompetence are simply passed to the rest of us anyway, only an order of magnitude greater, in the form of a client support nightmare every year. If HMRC doesn't have the money to operate these systems correctly then they need to refuse to bring in ever more complexity until they've secured the funding, and/or explain to their political masters the proper investments that are required. "Someone else's fault" won't do.

The likes of Amazon,  iTunes, Paypal, etc all run systems that are more complex than anything HMRC is doing on its 3rd party web servers side. Oddly enough none of those organisations turn their systems off for several days at the most crucial time of year. The thought is risible!  Every commercial organisation running web servers manages to install updates on the fly and then flick the soft switch that activates them. Working that way is a trivial software solution and to be frank taking down services for days to switch updates in beggars belief. On its own that amateurish howler ought to be grounds for terminating the outside contracts for their manifest failure to operate to a basic professional standard. Imagine if a cloud payroll or bookkeeping supplier turned their systems off for days to install updates. I'm grinning at the thought. They'd lose all of their customers immediately.

RT v HMRC    3 thanks

NYB | | Permalink

Fine when it's them that can't perform but if our system breaks down or from the advent of RTI the poor payroll administrator is sick or God Forbid may want a holiday they have or will have no sympathy.

Have case this week where a CIS Nil return was submitted by the due date and we have receipt and proof. HMRC say it has not been received, Went to appeal which has been dismissed. How can it be dismissed when proof is held. Is this going to be the future with RTI?

Another case - accountant dropped dead, everything up in the air. HMRC deemed this not "a reasonable excuse" when something submitted late.

Joy oh joy for new systems

sue essery | | Permalink

Well yet again HMRC in their forward planning of a new system they are making employers do have failed.  I have been saying to my colleagues for months now that it will not be able to cope as they are flooding their systems with P35 returns and FPS in the same period. I have been going it will crash wait and see. Let alone in this day and age they still have to take their systems doen to get a new tax year up and running.  Boy am I glad I left them years ago. 

mr. mischief's picture

NYB

mr. mischief | | Permalink

NYB

I have some exact experience of both of your cases.  In the case of CIS they dropped the fines - £200 in my case.  Their stupid database had lost the submissions.

In the case of the deceased accountant they were fining my client two lots of £400 for non-submisison of PAYE.  They dropped this to £356 on first review.  On third review it went down to £156.

I play a lot of poker - if they held 2 Aces would they be dropping the fine?  NO WAY, they've got 2-7 offsuit in those hole cards.

After fourth review I thought the Hell with this file the Tribunal papers.  This was now 15 months after the first fine, every letter was taking them 2 months minimum.

2 WEEKS after I filed at the Tribunal they dropped the case without even posting a defence, then coughed up £300 or so in compensation.

What a shower!

 

What a shower!

teresaweezer | | Permalink

I usually read the comments in various threads on AccountingWeb but resist the urge to vent my spleen.  However, I would just like to say that I admire John Stokdyk for making the case for HMRC. He is a brave man. In my very small practice, for which I spend a lot of unbilled time trying to help those which are less than experienced in matters regarding tax etc etc, HMRC are, in my view, hopeless.

For the government to make so many redundant at a higher level, to save more money on salaries ( but with huge redundancy payments) are in my view, extremely shortsighted.  We, on the receiving end, are left with junior staff trying to do their best but, through no fault of their own, are lacking in both clarity, good judgement, but above all, the necessary training to deal with a heavy workload.

I have too many stories to tell, in too little time, and to no avail.  It seems I have vented my spleen!  It must be because it is January 31st and I am tired and emotional having just about finished tax returns ;-)  Am about to open a very nice bottle of chablis.  Cheers!

OH Dear, We Are Amber !!!    1 thanks

Peter Tucker | | Permalink

Extract from a converstation between members of the Public Accounts Committee and senior management of HMRC on 5th November 2012:-

Q116 Chair: Thank you. Let us move on to RTI. We are all worried about this, and no doubt you are too. What is the rating that you have got from the Major Projects Authority on your part of this project? What is your rating: red, amber or green?

Lin Homer: I think we were amber.

Q117 Chair: You are amber.

Lin Homer: We are being looked at, I think quarterly, by both the NAO and the MPA, and I think that is helpful1. It is a big, important project and it is very useful to us. The most recent one was amber, which is sort of where we would expect to be at the moment, with-

Q118 Chair: Six months before.

Lin Homer: But a lot of work to do still. The project has learned something from previous projects. We have approached this by building up from small pilots, but we are trying to stay open-minded to the views of committees, agents, employers about the things that we still need to think about before next year.

AND

Q142 Mr Bacon: What I want to ask you about is the stuff that will still go on at the other end. In paragraph 17, it says that the Department will still have to undertake an end-of-year reconciliation of each taxpayer’s record, as employers will not report all data monthly under RTI. "The Department needs to decide, taking account of emerging findings from the RTI pilot, on which changes notified under RTI it should update on taxpayer records in real time and whether it can carry out any of the work currently performed at the reconciliation stage earlier." Are you clear about any of that yet?

Lin Homer: We are still looking at that.

Q143 Mr Bacon: Do you know what changes cannot be made during the year?

Lin Homer: It is not particularly "cannot". I am sure it is value for money that the NAO is interested in. There are some changes that will become evident to us by more regular reporting that we do not need to do anything with until the end of the year. The NAO also did some work with us on the number of work management items that we can and cannot manage to do. Those that will automatically sort themselves we will not lift out and work at the first point that they become noticeable to us, so we will make judgments.

Q144 Mr Bacon: That will be your decision criteria-if it will sort itself out anyway, we will not do it. That is how you decide, is it?

Lin Homer: That is one

Hey Ho what was everyone worrying about ?.