New RTI guidance for engagement letters

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The UK’s main tax and accounting bodies have issued new guidance on letters of engagement to help tax advisers prepare for the introduction RTI from April.

In the biggest change to payroll since the second World War, employers will have to send information about tax and NI they deduct from employees’ wages to the Revenue when they are made, rather than at the end of the tax year as happens now.

Amendments have been made to the Payroll Services Appendix B6 incorporating RTI for payroll to help practitioners prepare for transition to the new system. Most of the guidance on letters of engagement is unchanged. 

Practitioners are encouraged by the guidance to review their existing engagement letters and update them if necessary.

The guidance has been issued by bodies including the CIOT, ATT and ICAEW.

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05th Mar 2013 11:28

bit late

ours went out 4 weeks ago...ho hum...

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By Kazmc
12th Mar 2013 14:12


Hi there

Can I ask if all accountancy payroll Departments are putting into their revised engagement letters that they will not send any submissions to HMRC until they have the clients approval to do so?

We run 300+ payrolls a month, a lot of these are the same each month, do we really need to get approval every month from the client, this just seems an impossible task if we want to keep within the 'on or before ruling'...

What is everyone else doing?

Any comments really appreciated

Many thanks

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to meadowsaw227
12th Mar 2013 17:44



As the client is liable to a penalty if all goes wrong.  I would not take on any responsibility for errors personally, and will always email the client a PDF of  the payroll to check for accuracy and under RTI, a PDF of the employee list report showing their name address etc and this report on my software package shows the boxes for average hours worked ticked. 

In outlook I will have a reply button for them to email me back with the word Agreed.

If all goes belly up I will have evidence that the client agreed to all that was being submitted.  My only downfall would be if I did not submit the report on time after receiving their acknowledgement in time.  It seems like a lot of effort, but I am going to charge for this additional work.

I have been speaking to clients about this, and have also done a newsletter explaining all about what will need notifying to me (especially if anyone is paid out of the normal pay day period).  And even they can see how complex it will become.  They won't want to do this themselves and would prefer to rely on us.  But I certainly won't be taking any risks on their part.  if they havent responded in time, it won't go and my additional letter of engagement I am currently preparing, will say as much, and that I won't be responsible for any penalities.  They are also going to have to provide the information 7 days (5 working days) before pay day to avoid missing the submission deadline.

My clients have accepted the higher fees as a necessary evil, as I can't do additional work for free.

Hope this is of help.


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