Partner Rebecca Benneyworth Training Consultants
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PAYE reform: The software view

3rd Aug 2010
Partner Rebecca Benneyworth Training Consultants
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Rebecca Benneyworth examines the pros and cons of proposals to streamline the payroll system.

As anticipated, the coalition government's ideas to reform the PAYE system are provoking howls of protest from the software and payroll bureaux industries, whose businesses may be all but wiped out by the proposal.

Under the second phase of HMRC's plans to create a "centralised deductions" system, the tax department would assume the responsibility for computing PAYE, NIC and student loan deductions from payments reported gross by employers. The employer would compute the gross pay and be responsible for non-statutory deductions such as union subscriptions and pension contributions, as well as with statutory payments such as SSP and SMP.

The employer would then forward the funds to meet gross pay to a centralised deduction unit, which would compute the deductions and forward the net pay to the employee’s bank account. The balance would be retained by HMRC.

Under the new system, employers and employees would not need to worry about tax codes (saving millions in costs every year), nor would change of employment data or the annual P60 forms be needed; these would become HMRC’s responsibilities. These savings, as well as working out the net calculations and annual reconciliation, would relieve employers of a significant administrative burden.

But this change is a huge step and would need careful consideration and testing. The discussion document does recognise that there are potential problems, particularly for employees who will need to know whether they should contact the employer or HMRC about a query.

Mentioned in the June Budget material and now fleshed out in more detail, HMRC's proposals for radical reform of the PAYE system are built on the back of the new computer systems introduced over a year ago, known as NPS. It is clear that the system design of NPS was intended not only to overcome the issues with legacy systems, but to provide a stepping-off point for much more radical reform of a system that has been in place for over 60 years.

The discussion document (128kb PDF) on the changes sets out two stages that could be phased in over quite a short period – possibly two to three years. While employers and HMRC could enjoy significant savings, the software industry and payroll bureaux would be frozen out by the centralised deductions regime.

The first phase of the PAYE reform project is less controversial and concerns the provision of real time information when payments are made to employees. This approach would obviate the need for annual returns (although forms P11D would still be needed) and would reduce work in reconciling the tax position of individual employees after the end of the tax year.

The NPS is centred around an individual employee record for all employers, and thus could be self-reconciling throughout the year. Over and underpayments of tax would be identified promptly and highlighted automatically – a subject about which HMRC has received significant and repeated criticism.

It is also envisaged that information provided on change of employer forms (P45 and P46) could probably be dispensed with, and a date of starting or leaving just filed with the payment data, coding notices being triggered automatically to the new employer.

The discussion document also envisages this information being made available to the relevant authorities when the employees are benefit or tax credit claimants, reducing the requirement for claimants to make separate notification and speeding up adjustments to claims. This would only be done if the necessary statutory authority were in place, but it is expected that this could reduce fraud and error in the tax credits and benefit systems significantly.

Working patterns have changed, with employees moving between employers much more frequently, and in many cases carrying out several part-time jobs concurrently. At the moment, a great deal of time is spent every year in reconciling the payments made monthly (or quarterly) by employers with the annual return – form P35. Employers, pension providers and payers of taxable benefits and HMRC all spend significant amounts of time in merely providing information and checking it to ensure that the annual payroll submissions balance.

There is an additional benefit which accrues only to HMRC. When the new penalties for late payment of PAYE and NIC were designed, it became clear that the system could only work if there were monthly reporting of liabilities due. Without this, officers will need to visit those who pay late to identify the correct payments due and charge penalties accordingly; it is therefore clear that although the system has been implemented this year, it will deal with only the very worst cases of non-payment. When the idea of monthly returns was considered, it was immediately rejected on the grounds of the additional burden for employers. With regular real time information, HMRC could chase (and if necessary penalise) late payment much more effectively.

Automatic capture of information as payments are made has a number of merits. Clearly, additional work will be necessary for the software companies in engineering the additional data so that it can be provided, and the volume of additional data is quite considerable, but is all available within the payroll system (or on the P11 as the discussion document refers to it).

The data would be submitted when the employer makes electronic payment. Small employers could join in through the modification of the HMRC software available on the Employers' CD ROM – designed for employers with less than 10 staff. Clearly the provision of this information will be acceptable only in electronic format, but those employers who do not pay PAYE over electronically could be included in Real Time Information through use of the CD ROM. Mandation for all employers – with very small exceptions on religious grounds -  would seem to be a given.

Subject to the concerns that software companies will raise about the speed of this change, and the issue about sharing and security of data being adequately addressed,  the move to real time information is irresistible.

Provided adequate provision is made for small employers, it relieves employers of a major headache at the end of the tax year, and will allow HMRC to perform its function to ensure that taxpayers pay the right amount of tax – and to collect tax from employers – more effectively than ever before. It should save the taxpayer money too by streamlining HMRC's processes and removing unnecessary work after the year end. The consequent benefits for the tax credits and benefits systems should not be overlooked – again presenting savings for the taxpaying community.

The arguments put forward for real time information are difficult to challenge in terms of improving the current system and removing redundant work. I see no real difficulty in implementing this element of the reforms and then seeing where it leaves us, but as several members have already pointed out, centralised calculation of deductions could be a recipe for disaster.


Replies (27)

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By memyself-eye
04th Aug 2010 11:25

I predict a riot

When an employee doesn't get paid on the due date either because his employer has cash flow problems and has not sent the gross payemnt to HMRC (the employer of course denying this) or, more likely, HMRC either failing to pay the employee, or paying someone else entirely.

If current experiences are anything to go by this will be a nightmare - a bit like the NHS 'global' computer system, tax credits system, CSA, etc etc etc....

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By Sara Graff
04th Aug 2010 15:15

PAYE reform

I think all accountants and payroll agents should be extremely concerned over the new proposals.  Where there may be merit in a realtime system and reducing the burden of end of year procedures, the proposals seem to ignore the fact that not all payroll bureaux organise bacs payments on behalf of their clients nor do they want to.  If information supplied to HMRC is supposed to be at the same time as the payment is made I foresee immense problems.

Far more worrying is the proposal for centralised deductions which is an absolute recipe for disaster and would mark the end of payroll bureaux.  Who in their right mind would want HMRC to calculate their deductions, given their track record.  I thought the idea of self assessment for income tax and corporation tax was meant to put the burden and responsibility for calculating and declaring tax on the taxpayer's shoulders - this seems to be a complete about turn.  I thought that David Cameron's philosophy was less interference by the State.  Also who is to pay for the enhancement in the HMRC software (which we can guarantee won't work properly) and the extra staff needed to deal with the many queries employees will have over the deductions,  given that HMRC is to experience 25% cuts.  I could go on and on!

I would urge anyone with any interest in this matter to respond to the consultation paper before the closing date of 23rd September


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Wild Billy Hickok
By Wild Billy
04th Aug 2010 16:41

It'll never work!

Imagine if we had been around 100 years ago. Imagine all those crazy ideas that we, as experts, would have rallied against, highlighting the difficulties and improbabilities. Change, after all, is a difficult thing and it is perfectly natural to be cautious and retreat to the safety of what has been rather than look forward to what could be. Dug out a few quotes from "experts" on various topics that I'm sure would have peppered messageboards like this:

 The horse is here to stay, but the automobile is only a novelty—a fad (Advice from a president of the Michigan Savings Bank to Henry Ford's lawyer Horace Rackham. Rackham ignored the advice and invested $5000 in Ford stock, selling it later for $12.5 million.)Automobiles will start to decline almost as soon as the last shot is fired in World War II (Harry Bruno, aviation publicist, 1943)There is not the slightest indication that [nuclear energy] will ever be obtainable. It would mean that the atom would have to be shattered at will (Albert Einstein, 1932)Heavier-than-air flying machines are impossible (Lord Kelvin (1824-1907), ca. 1895, British mathematician and physicist)Space travel is utter bilge (Dr. Richard van der Reit Wooley, Astronomer Royal, space advisor to the British government, 1956)Airplanes are interesting toys but of no military value (Marshal Ferdinand Foch, French military strategist, 1911)I confess that in 1901 I said to my brother Orville that man would not fly for fifty years. Two years later we ourselves made flights. This demonstration of my impotence as a prophet gave me such a shock that ever since I have distrusted myself and avoided all predictions (Wilbur Wright (1867-1912) [In a speech to the Aero Club of France (Nov 5, 1908)]There is no reason for any individual to have a computer in their home (Kenneth Olsen, president and founder of Digital Equipment Corp., 1977)

So even the best can be wrong, guided by what has happened in the past rather than what might be possible in the future. As Peter Ustinov once said: "If the world should blow itself up, the last audible voice would be that of an expert saying it can't be done".

Over years and years I have come to understand the difference between those who quite legitimately flag up problems and say it can't be done and those who understand the problems but can see beyond them to look for solutions. It's very easy to knock down an idea- any idea- but it is much harder (and rewarding) to look at the possibilities with an open mind and think about solutions that could make PAYE better than it is now. The alternative is the status quo, which we are comfortable with because it is familiar but still continually criticise and demand better.

Let's see what happens. Like Sara, I too would urge anyone with any interest in this matter to respond to the consultation paper before the closing date of 23rd September.




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By carnmores
04th Aug 2010 17:18


is poised to strike

we also have iXRBL from next year

how soon before all accounting systems have to be live linked to the HMRC


what will companies do when they are short of the PAYE NI monies as is bound to happen from time to time

that will be a test of the system

how many companies will lay off staff and only use short term contractors

also the knock on effect of delayed directors salaries will proge challenging for some 


 PS nice to hear from you Rebecca!

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By chatman
05th Aug 2010 02:06

It'll never work!

Yes, and what about those silly people that said the Tax Credits system would be a fiasco; that it would be too complicated for many deserving people, and that loads of poor people would be told to repay money they had already spent, thinking it was legitimately theirs.  If we had listened to them at the time we would not have the marvel that is our Tax Credits system today.

And I bet those that said privatising the railways would be a disaster are feeling a little sheepish now, not to mention those who said the poll tax wouldn't work, and the BP employees who warned against turning off the alarms in case they disturbed anyone.

When someone objects to a change, it is very easy to claim they are simply scared of change. However, such a claim needs to be supported by coherent argument if it is to be taken seriously.

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Wild Billy Hickok
By Wild Billy
05th Aug 2010 08:46

It'll never work!

The point I was trying (but clearly failing) to make was there is ALWAYS resistence in some quarters to any new idea at the start. There are ALWAYS reasons not to do something and doing nothing will ALWAYS guarantee against something going wrong with a new system. 

I'm not sure anyone has said there aren't challenges to designing and deliverin any new PAYE system. Of course there are. Lots. It could fall flat on its face. But you could say that about anything... and just maybe be wrong. Look at the experts I quoted. The difference between aeroplanes, space rockets and nuclear energy being a sucess and failure was people engaging with the issues and saying (i) there are problems and (ii) this is how we can overcome them. Seems to me there is a bit too much of (i) at the moment and not alot of (ii). Frankly, people who can do (i) are ten-a-penny in life; it's people who can do (ii) that you should surround yourself with.

For every tax credit system and poll tax, I can raise you something that has worked. Not much point in getting into that game really. Do you think there weren't naysayers in the industry who couldn't believe corporation tax and capital gains tax would work when they were introduced in 1965? Can you imagine what the reaction must have been to the introduction of income tax all those years ago or PAYE in 1944? Lots of reasons why they shouldn't have worked either. The important thing is to understand why they did work and learn from experiences where things have failed. Not to say that means it can't be done but to say this is how it could be done. Lots of reasons not to date a colleague but lots of people meet their partner at work and make it work.

Maybe I'm just a contrarian by nature. I certainly get deflated by a profession that constantly criticises a system and when given a chance to change it say it is all too difficult. What good is that? I'm happy to applaud the Government's intent to find a solution and then think about how that soultion could be made to work. If I don't think it can work or say what would be required to make it work then it is up to me to say either (i) here is my alternative or (ii) I'm happy to say the current system is fine and can go on for the next 60 years (with me not moaning about it because I had the chance to change it and didn't take the opportunity). So how about approaching it by saying "what will need to happen to make these things work" rather than "what are the reasons these things won't work"?


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By PeterGGreen
05th Aug 2010 12:16

Realtime information = Yes. Centralised deductions = No.

As a Payroll Software developer, I have no problem with the realtime collection of P11 info.  In fact the only thing I would prefer is that it's done with the HMRC gateway rather than through BACS data.  We already have that framework in place.

But a centralised deductions system is a disaster waiting to happen and I, for one, will be fighting against it as hard as I possibly can.  HMRC can't even keep track of online submissions once they're sent in.  How would they handle the billions of pounds sent through it every week.

I'm sure they will tell you it will be fine...  Until it isn't.  Then try getting through to someone at HMRC who can actually help you!!

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By bradburn
05th Aug 2010 12:26

Reduce Costs?

The banks charge so much for banking cash these days nearly all my clients that take cash prefer to pay their employees cash saving a fortune in bank charges. Many employees also prefer to be paid in cash. How will this work with the new system?

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By Michael56J
05th Aug 2010 12:34

Real Time Computing

The idea of real-time computing of employees' liabilities is laudable. What a wonderful idea - get HMRC to do all the work of calculating the payroll. Marvelous.

And the idea of insisting that employers send the cash to HMRC (requiring real-time banking, which is still in its infancy) does away with those unscrupulous employers who take deductions from their employees then pocket the money, rather than handing it over to the Revenue. It would save tax payers the cost of court cases to wind up businesses that have no hope of ever paying (because the directors have disappeared with the money), leaving us with a lower tax bill. Excellent.

My only concern is that HMRC currently seem to be working on data for 2006. We are receiveing Overpayment Notices relating to 2005/2006. Has anyone told them it's now 2010? Will the new tax bands also take 4 years to implement?

Or, like Tax Credits, will tax liabilities be estimated according to last year's earnings, with employees having to make up the difference (that results from incorrect assumptions by HMRC) from the first pay that they receive in May, after the end of the tax year? (And, if the tax credits system is anything to go on, probably not getting any more pay for the rest of the year!) If it is based on an estimate, will there be an income increase disregard? Or will the lump sum underpayments be left for offsetting against future liabilities?


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By aburt01
05th Aug 2010 12:44

Phase 2 - outsourcing last step of PAYE

Phase 2, to my mind, is very like outsourcing the last step of PAYE calculation.  Outsourcing is not new.  The bit that is new, in this case, is that the outsourced provision comes from HMRC.

So what if HMRC have a monopoly on the last bit of info. i.e. tax, NIC and net pay?  and knowledge of why it has been calculated that way?  They already do have a monopoly.  They send a tax code (and another, and another) out to the employer with no explanation.  The employer's job is just to follow instruction.

In Phase 2, perhaps the PAYE software at the employer's site will have secure access to these last few figures, i.e. tax and NIC results posted back from HMRC; as a minimum at least the employee should have secure access to details of the calculation. Isn't that what you call SaaS?  Isn't that what global - personal - internet access is for?

Either way, it is not insurmountable.

You just need to think outside the box.  And it would not necesarily kill-off bureau as you might think.

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By jeffcoe
05th Aug 2010 12:55

It could work

My first reaction was the same as most other - it will never work


Thinking it through then it is possible and would be viable. If HMRC set up a good and reliable on-line PAYE scheme, each employer would the use their user ID (employers PAYE ref number) and a password. They would then set up and maintain a data base containing each employee’s details. To process the payroll they would then  input pay details, the program could calculate the net pay, generate payslips and automatically BACS net payments to the employees account. On completing the payroll, the employer would be informed of his total liability, including Employers NIC and advised that this would be taken, by Direct Debit, from his account within 3 days.


However, it goes without saying that HMRC must ensure that the system they use is "tried and tested" and they must have the capabilities of coping with the demand .......... based on past performance.........therein could lie the problem


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By Debra Wilson
05th Aug 2010 13:30

Reform of PAYE system

Try getting through to the Revenue full stop.  Instances where there is no dedicated Agent line result in hours of wasted time (45 mins the other day and that was at 8am)

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By geoffwolf
05th Aug 2010 13:37

If PAYE and NI due date is 19th

institution of the suggested system would create a once for all cashflow problem for employers unless the system could be dealt with by separate direct debit for net pay and  deductionspayable to HMRC.

This is particularly a concern  as regards employees paid at less than monthly intervals and those who recieve payment mid-month.


How is it suggested that the system would operate for exceptional circumsatances such as redundancy, breach of contracr etc etc.......

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By callan
05th Aug 2010 14:06

It'll never work...

Although Billy lists an entertaining catalogue of failed predictions, he assumes that all "It'll never work" comments are knee-jerk reactions and not considered responses. Yes, any solution to a problem needs work and development, but it also needs a risk/benefit analysis.

In this case the major risks are two-fold. The first is the track record of those developing the solution, which are, shall we say, not impressive. Yes, plenty of people predicted you couldn't develop a flying machine, and it took a lot of work, but you wouldn't give the task of achieving it to a company who previously built a submarine that sank and a bomb that wouldn't explode. The record of Government IT projects should make everyone wary of depending on them to get our pay correct, (or even delivered).

The second risk is when someone makes a mistake. (Yes, it does happen!). At the moment an employee can go to their employer to get it sorted, but what guarantees have they got that the central service, if they can get through to them, won't just read back the incorrect information for a computer screen? My bank once decided arbitrarlily that I was dead because it had mixed up my details with my father's. It took a lot of sorting out, but at least I was still being paid. What if a similar mistake froze somebody's pay?

Unless we get cast iron guarantees there is every reason to be doubt this approach.

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By tringyokel
05th Aug 2010 14:36

It could work ...

 and I wouldn't mind seeing it work but past experience indicates that there is a good chance it will not.

The first phase is probably not too bad.  It boils down to collecting information in a different way to that in force now.  The system should not go live until it has been fully tested and needs to be robust enough to cope with the practicalities.  Let's not have HMRC surprised that most employers run a payroll at the end of a month.

The second phase, the "centralised deductions", will obviously be of great benefit to the government.  But failure to implement this correctly will have far reaching consequences.  If they decide to go ahead then it should be under certain conditions, such as -

Everyone will need access to a bank account.  This will need to be a charges free current account and easily accessible to all.  Perhaps we could reinstate the old network of post offices to provide this.  In theory anyone can open a basic bank account with the high street banks but in practice many are refused.  The government needs to cover these cases.

Employees need their wages paid on time.  Responsibility for this will be with HMRC so they should negotiate real time transfers with the banks.  No waiting for three or more days for payments to clear.  Any failure where the money arrives late should be covered by an indemnity where HMRC will pay all associated costs of the late payment (bank charges, surcharges, etc levied by banks, credit cards, mortgagors, etc).

Incorrect calculations resulting in underpayment of wages should be corrected and an appropriate amount of interest applied.  This should be calculated by reference to the average interest rates charged by credit cards to be realistic.

On the other hand, overpayments should be reclaimed but the interest here should be related to average bank current and instant access deposit rates.

If they are charged with these responsibilities at the outset then perhaps they will get the system working properly from the outset.  


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By Oppco
05th Aug 2010 14:59

PAYE reform

I don't think anyone is against reform on the grounds of opposing change.

It's just that we all know HMRC would be incapable of running such a system


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By philfromleeds
05th Aug 2010 15:32

Cetralized Deductions for PAYE

If cetralized deductions works it will be very good for the Nation. I run a payroll service will the government pay me compensation?

The government will work out the Payroll and the Indians will do the book-keeping and Accounts, that leaves the Cowboys to make a living.

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Wild Billy Hickok
By Wild Billy
05th Aug 2010 15:34

On that basis then we can never have any change

If this ultimately boils down to whether we trust HMRC or think they are capable of implementing such a reform then, let's be honest, we are always going to be tainted by things that haven't gone well. It's easier to remember them than all the things that go right on a daily basis. But, as any investor knows, past performance is no guarantee to future performance. And I have an inkling that HMRC will know there is a risk of massive reputational and economic damage if it introduced a new PAYE system that left 20m+ employees not receiving their wages at the end of the month (or week or whatever). Do you seriously think they don't get that? Is it possible the overall service from HMRC could actually improve if PAYE is automated in this way because staff can be redirected to deal with phone calls etc? Maybe, I don't know. What I do know is that by not engaging with the process in a constructive way we all risk an outcome that we don't think is workable. Isn't the fact this is a discussion paper rather than a consultation paper suggest HMRC is keen to make sure it has understood all the issues before decising how to proceed?

At least we now seem to have a more balanced discussion about how this could work rather than just a sense of negaitivity. And thanks to the person who told me what I was assuming. Next time I need someone to tell me what I am thinking I'll let you know so you can tell me.


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By BigBadWolf
05th Aug 2010 15:34

CSA & Tax Credits

Have no lessons been learnt from the Child Support Agency & Tax Credits debacle?

A Goverment agency is incapabale of running any system - especially when it involves large amounts of money & people's daily livelyhood.

Imagine the devastating consequences of what a screw up with a person's salary could have - missed mortgage payments, eviction, damaged credit rating, no money for food?

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Wild Billy Hickok
By Wild Billy
05th Aug 2010 15:39

Oh dear

If cetralized deductions works it will be very good for the Nation. I run a payroll service will the government pay me compenation?

The government will work out the Payroll and the Indians will do the book-keeping and Accounts, that leaves the Cowboys to make a living.

Says it all really. Why would the Government pay you compensation? And why would this lead to book-keeping and accounts being outsourced to India (or perhaps somewhere that doesn't quite match your cliched sterotype)?

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By nigelburge
05th Aug 2010 15:42


"However, it goes without saying that HMRC must ensure that the system they use is "tried and tested" and they must have the capabilities of coping with the demand"

When have they EVER done this? Of course it was one of the conditions laid down by Carter so of course, HMRC has steadfastly ignored it.

Any Government who introduces this is going to have a death wish because we can all guarantee that it will cause utter chaos, at least for the first year.

Thank the Good Lord above I am self-employed. :-)

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By Gentoo
05th Aug 2010 16:16

Many concepts bandied about but few definitions nor any sense of
"Real Time" sounds like one of those motherhood and apple concepts that is impossible to argue against (after all, who would argue for things happening in unreal time?)

But does anyone using the term (and let's not exclude HMRC) actually know what it means? Has it actually been defined anywhere?

Do they mean

(1) "instantaneous"?

(2) "sufficiently quickly so by the next time you look it's happened"?

(3) "asynchronously triggered"?

Any system has got to have a loop response time less than the its required update response time (otherwise it develops the equivalent of worklists and starts correcting its corrections)

Systems with short response times trade stability and reliability for flexibility and agility. They also cost more to build and to run.

(so, fighter aircraft can turn on a sixpence but can't glide for toffees, civil aircraft have a huge turning circle but can glide under no power for thirty seconds - and helicopters fall out of the sky when you take your hands off the controls)

The reasoning that a PAYE system needs to behave more like a fighter aircraft and less like an oil tanker because there are more people with multiple employments needs closer scrutiny.

Some people with multiple employments might have relatively stable circumstances so once the existing system settles down (PAYE codes have been sorted out) then all is well

Some people with multiple employments might have a major job and one or two minor jobs (e.g., 80:10:10) in which case they might be happy with a PAYE system that lags a little providing it eventually determines.

I am sure that the accountants among you will be able to develop other use cases.

So how many people (as a percentage) would see their PAYE performance significantly improve compared to a do nothing/ continuous improvement model.

Of course if one could build a single system that provides fighter aircraft capability with civil aircraft capacity (but let's not forget "reliable" "cost effective" "soft-fail stability" "hot-switch back-up systems".

Do we have any evidence that any government system has been designed with this "reliable" "cost effective" "soft-fail stability" in mind? (funnily enough, yes, the PAYE system as currenlty operated)

The government designed a instantaneous update systems for MOT - here's a reminder as to what happened:

it was late:

it created chaos:

MOTs are one thing, a system that collects 80% of the tax take is another.

Even if such a scheme were piloted, the evidence would not provides a basis for scalability, because a system changes in character as it scales (by way of analogy, the time it takes to get from one side of Waterloo Station to the other is not dependent on how fast you can walk, but the time of day you are attempting the task).

If I were designing a PAYE system it would be on big society principles rather than big government, I'd publishing the rule set, set minimum standards for participants, encourage multiple centres doing distributed processing, improve data logging, add store-and-forward capacity to manage variable data volumes and leave HMRC to collect aggregated data. There'd probably need to be a balancing mechanism for difficult cases.

What do accountants and payroll bureaux think about that idea? Any takers?

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By Waterangelica
05th Aug 2010 16:33

Real Time PAYE

Why mend what isn't broken ?? Just look at the Civil Service now civil ( mainly because most of them don't understand what they are supposed to be doing ) and no Service - in fact it's self- service ( self assessment ) and then they penalise a poor bod for misunderstanding what was required

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By stgreg
05th Aug 2010 16:39

They have no idea

All the HMRC people and civil servants involved in this proposal should be required to spend six months working in a payroll department that deals with SMEs.

They clearly do not have the slightest idea of what payroll departments actually do or how they really work and they really should find out before (well before) they start to reorganise the PAYE system.

There is much that could be improved in the existing system and it really is much more sensible to get the processes working and the whole system simplified BEFORE major changes.

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By callan
05th Aug 2010 16:46

It'll never work (part 5...)


Actually I agree with most of what you say, Billy, and I'm certainly no mind reader, but it's the difference between negativity (which you seem to be ascribing to the critics) and healthy scepticism. You've said that

"I'm not sure anyone has said there aren't challenges to designing and deliverin any new PAYE system. Of course there are. Lots. It could fall flat on its face. But you could say that about anything... and just maybe be wrong. Look at the experts I quoted. The difference between aeroplanes, space rockets and nuclear energy being a sucess and failure was people engaging with the issues and saying (i) there are problems and (ii) this is how we can overcome them. Seems to me there is a bit too much of (i) at the moment and not alot of (ii). Frankly, people who can do (i) are ten-a-penny in life; it's people who can do (ii) that you should surround yourself with."

and I entirely agree. I've no time for people who spend their day just telling you why you can't do something. But this is a process, not an end in itself. The end is to reduce costs and improve efficiency, not to centralise. If centralisation will achieve this it's worth looking at, but please don't suggest that people who doubt it are simply against change of any sort.

The problem is, as you say, that there is a risk it could fall flat on its face. But that's a risk you can't afford to take, not with people's livelihoods. It has to work flawlessly from day one, and I for one think that getting it to that state would ultimately cost more than any efficiency savings.


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By chatman
05th Aug 2010 16:57

"Do you seriously think we don't get that?"

I would say it is a definite possibility. 

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By Irene
05th Aug 2010 17:26

Centralised Deduction

Change is eminent and its result the consequences that live with us. At this time of economic wahala (difficulty) eating deeply into peoples' financial well being, any measures that purport one struggling to get hold on any penny that he has worked for, be it by contacting HMRC for wrong deductions or not receiving your pay package caused by some error, can hardly be welcomed. Good a thing this is just a discussion document and hopefully the government will take into consideration the views that are put forward. On a personal note the centralised deduction stuff is not best at this current time.


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