RTI: payroll processed in two places?

RTI: payroll processed in two places?

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I have been posed a question by a colleague who has a client with the following scenario:

A company employs a dozen staff, paid weekly, and three directors paid monthly. The directors' payroll is administered by one of the directors, whilst the weekly payroll is administered by an admin clerk, who never gets to see any of the directors' pay details. The directors do not want the admin clerk seeing the directors' pay details. Both parts of the business use Sage payroll, but are located in totally separate geographical locations in England. I understand that under RTI, separate FPSs can be made for weekly and monthly employees, but can the above scenario continue? Will the submission of a weekly FPS with no details about the monthly employees (because they are not included on that payroll at all) cause a problem with HMRC (and likewise for the monthly FPSs)? And how should the company best submit an EAS? Sage payroll says that with their software you have to submit an EAS regardless of business size.

Thanks for any advice or guidelines.

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Euan's picture
By Euan MacLennan
11th Mar 2013 18:23

This is a Sage problem

There is no requirement under RTI to file an EAS if there are less than 250 employees.  Perhaps Sage will fall into line when they upgrade their software to 2013/14.

Failing that, your colleague might be able to avail himself of the split scheme concession set out at Q3.3 and Q3.7 of the RTI FAQs.

According to Richard Carey of Moneysoft, if the monthly and weekly staff were on the same payroll, YTD figures for all of them would be submitted on every weekly FPS, but the monthly staff, for whom there would be no current period figures for 3 or 4 successive submissions, would not be treated as leavers until they had missed one or two monthly cycles - say, 8 or 9 weeks.  If the RTI specification is sufficiently sophisticated to treat staff with different pay frequencies on the same payroll differently, I would think that it would cope quite happily with weekly only and monthly only FPS.

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Tom McClelland
By TomMcClelland
11th Mar 2013 19:32

To file the EAS...

An EAS isn't required unless Sage insists on it, but you do need the first FPS to include the directors (even if with zero pay) as well as the employees.

A workaround might be to add the 3 directors to the weekly payroll but without any pay details. Once the EAS (or first FPS) has been filed the 3 directors can be removed again.

Then just continue to file FPS's from each location separately and everything should work fine, as long as Sage will permit you to file an FPS without filing an EAS first in the director's payroll. (it really ought to, or it is an unworkable solution as a piece of software in numerous cases).

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By gary.ging
12th Mar 2013 12:59

EAS or FPS

 

Hello, I’d like to reply to the original question and respond to some of the points that have been raised in the replies.

Just to put your mind at rest, this isn’t a Sage issue, in fact, there isn’t actually an issue at all. Whilst HMRC do expect an EAS for any scheme with 250 employees or more, they will also accept an EAS for a scheme with less, and this is the preferred alignment method within Sage 50 Payroll.

However, if all employees within the scheme are processed within the same company in the software, and they are all being paid in the first pay period under RTI, then the first FPS will include all of the information required for the alignment submission and this method can be used within our software.

There are currently just over 28,000 PAYE schemes being processed by some of our customers in the RTI pilot and the feedback we have received is that the experience is extremely simple, so using the EAS as the alignment submission is not an issue for them.

With reference to the original question, HMRC have updated the EAS schema for 2013/14 so that it can deal with split schemes as described in original post, and this update means that it actually becomes easier to do an alignment via the EAS than the FPS for anybody in this situation.

When doing the EAS within our software from April you can specify how many EAS submissions will cover the complete PAYE scheme. This means that you can do an EAS in the director company and then another EAS in the weekly company without having to spend the time to merge or re-enter any data just to get all of the employees in the same place in order to include them all in the first FPS. This is why HMRC did not want any split schemes in the pilot year, as per the FAQ referenced above.

If jcace would like to contact me for any further information then I’d be happy to help.

 

Regards

Gary Ging

Sage (UK) Ltd

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By zeofiles
12th Mar 2013 13:05

It can be done

Having been through this process on two occasions now, I can confirm it is possible to do this on sage but (the first time at least) it was a nightmare!

As @TomMc correctly states, an EPS is not required but the first weekly payroll FPS should include the directors. 

The easiest way to do this is from the weekly programme.  You will therefore need to load the directors details on this machine.  Download the directors ‘employee details’ file in CSV format (go to wizards, then data export, then payroll data export then select employee details) from you system and then restore this CSV file to the weekly system.  This only shows the personal details and therefore nothing that could be classed as sensitive.

You can then do the FPS from the ‘weekly pay’ system

However, you then need to make sure that the RTI payroll ID reference number (a unique reference for each employee) that will have been allocated to the directors is copied back onto your system.  This ID number is shown under the employment tab of employee details.  Unfortunately, you can’t manually alter this on Sage, so you would need to reverse the above process – take an employee details back up from the weekly system and restore back to yours.

Although it was a very frustrating process – a learning curve for sage as much as me! - with the help of sage support we eventually got there.

Hope this helps

PS – As far as I am aware, you don’t need to do an EPS for Sage clients. 

 

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JCACE
By jcace
12th Mar 2013 19:47

thank you
Thank you all for your replies, and Gary, I may well contact you for any further clarification. Really helpful and reassuring.

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