Technology insight
HMCTS If you regularly follow the workings of the CIPP policy team you will be aware that we have been working closely with HM Courts & Tribunals Service (HMCTS) and CIPP members to explore how we can improve the collection, payment and reconciliation of deductions made under the pay attachment process to the courts for civil and criminal debt. In the first instance, HMCTS will attempt to solicit a payment directly from the individual. Depending upon the region in which they fall, this process will vary and will be by use of traditional communication methods. In the event these methods fail, HMCTS are now able to contact HMRC to request the most recent employer records that they hold, via RTI processes, which in turn enables HMCTS to issue pay attachment notices. Indeed, you may have noticed an increase in the number of attachments that are being issued now. For larger employers and for HMCTS there has certainly been a noticeable increase and thus further work is needed so that guidance is clear and consistent for employers to ensure that payments made can be reconciled in an accurate and timely manner to the court records. The impact of the reconciliation being wrong can be significant for individuals. At the moment, RTI data takes us only so far. The Pensions Regulator HMRC, via their PAYE records, provide a rich source of data for The Pensions Regulator which in turn has enabled a smooth delivery of the reform of workplace pensions through automatic enrolment. From the very first headcount in 2012, which provided data for the staging timetable through to the regular RTI feeds of data on employer activity with HMRC, The Pensions Regulator has been informed as to the numbers and contact details of new PAYE schemes, which in turn enables them to monitor (and follow up) employer compliance. Department for Work & Pensions So much has been written about the benefits of RTI to welfare forum and universal credit, and the subsequent delay of the delivery of universal credit, that I am unable to add anything further at this
found in the compliance arena. What would have taken months to process in the past now takes HMRC primarily – but other agencies increasingly too – minutes. A HMRC briefing in 2016 told us that “Connect is an award-winning, powerful risking engine that is at the heart of HMRC’s analysis and compliance activity. It contains more than 22 billion lines of data, which helps HMRC to more easily identify tax evaders and avoiders. This is equivalent to a pile of A4 paper 158 miles high, 28 times the height of Mount Everest. Since its introduction in 2010, it has generated more than £3bn in additional revenue.” Undoubtedly RTI data provides a rich data source for Connect which works by making it easier to see patterns, links and networks that would be impossible for the human eye to see among the mass of data arriving at HMRC each month. Government transformation strategy Earlier this year, John Manzoni, chief executive of the civil service, delivered a speech about how the government is using big data and open data to improve public service delivery. Having recently seen the publication of the government’s transformation strategy he confirmed that in utilising the benefits of ‘big data’ there were three key areas of opportunity that government needed to grasp: ● improve the experience of the citizen ● make government more efficient ● boost business and the wider economy. Clearly real time information plays a huge part in delivering the benefits of big data. Back in 2010 the all-party parliamentary taxation group saw RTI as a stepping stone and not the final destination for modernisation of PAYE, with the ultimate goal being centralised deductions underpinned by attaching payroll data to a payment instruction. I think it is fair to say that is unlikely to happen any time soon. However, we are seeing RTI impacting the development of government policy and I offer, as my evidence, the apprenticeship levy – the idea of processing apprenticeship funding via the payroll function would never have been considered were it not for RTI. The CIPP policy team always value your feedback as to your experiences with any aspect of the RTI process – and your views as to its future - and your emails are welcome to policy@cipp.org.uk . n
juncture other than to observe that whilst the Department for Work & Pensions benefits from a regular flow of RTI data from HMRC throughout the day it would appear that this flow of information is only one way. = Tax-free childcare As we see the rollout out of tax-free childcare – launched in April 2017 and hailed as (part of) the ‘government’s flagship childcare offering’ – we are becoming aware that whilst there is an automatic feedthrough to tax credit data held by HMRC the same cannot be said of universal credit data held by the Department for Work & Pensions. To the observer RTI appears to be a one way street for universal credit interaction and with other policies. A parent cannot be in receipt of both tax credits (or universal credit) and tax-free childcare. If they make a tax-free childcare application an automatic stop will occur to their tax credits when the successful application is processed. This is not the case, however, if they receive universal credit – and so the risk of incurring an overpayment, either with a top up to the tax-free childcare account or through universal credit, increases. ...rich data source for Connect which works by making it easier to see patterns, links and networks... Student loans Alas, this is probably not a good example of how HMRC have capitalised on their use of RTI as the benefits appear largely to link with ensuring the employers are making regular deductions when they are issued with a student loan SL1 starter notice, rather than ensuring a real time update to the borrower’s student loan account. Though that reconciliation still happens annually, we live in hope for developments in this area as it is an obvious next step. Compliance work Inevitably, the largest benefits can be
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| Professional in Payroll, Pensions and Reward |
Issue 33 | September 2017
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