I have a client who's just taken on a new employee. To tide the employee over, the client wants to pay him part of his salary early.
Of course, this raises RTI issues, because everyone else will be paid as normal at the end of the month. I just wondered if there was a way to do this? I'm using Moneysoft Payroll, and am in the process of picking their brains too, but they don't think there is a way.
Yes is a problem under RTI, as I understand it you are no longer even allowed to give employees an advance, which to my mind is totally ridiculous. I think the only way around this is for your client to give the employee a loan (not an advance!) and then deduct this from his first salary payment.
It's so tying for businesses and frankly me (thinking of ditching payroll) but also I know of several instances where staff have moved on, had an immediate p45 issued yet new employers have not been told until several weeks later so people are on wrong tax codes and have to start reclaiming tax. Maybe when the fines kick in this will avoid this but I'm not convinced that HMRC are so on top of their end (other than issuing fines which they are very quick to do, of course).
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
I like the idea of giving 'loans' to employees. I might well use this as a way round delays in getting information from previous accountants etc., etc..
If you don't like RTI , just wait until Automatic Enrolment starts to affect the small employer. It's going to be horrendous, if the course I attended today is anything to go by. Payroll bureaux need to be looking at their clients' data now because you need at least 12 months preparation time, according to The Pensions Regulator.
My issue with RTI is we have a casual employee who gets paid for the week after I have run the wages, however when I do the wages I have no idea how much they will be paying him.
Can you not set them up as a weekly/fortnightly based employee for the first month so the RTI will be filed only for them, then the following month change them to monthly based, along with everyone else?
We are all on weekly, I do wages on a wednesday so I can pay them in time via BACS, he gets paid cash on the friday/saturday for the work he has done that week, so I either guess on a wednesday as to what he may get on a friday/saturday or just don't fully comply. It would be easier if they paid him a week in hand like everyone else :)
Bummer! Unless they move him to a week in hand or at least move his cut off day and give him a 'loan' for an extra week. Or you do an additional payroll. HMRC have no idea what its like in the real world and frankly dont care - such a huge burden on small businesses!!! Joy!
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
