Real Time Information (RTI) changed the way UK employers report payroll data to HMRC. Instead of submitting annual returns, you now send information about tax and National Insurance every time you run your payroll. For small and medium businesses across Hull, Beverley, Driffield and the wider East Yorkshire area, staying on top of RTI requirements is essential to avoid penalties and keep your workforce paid correctly.

This guide walks you through everything you need to know about RTI compliance, with a practical checklist you can use to audit your current processes.

What is RTI and Why Does it Matter?

RTI stands for Real Time Information. It requires employers to submit payroll data to HMRC on or before each payday. This includes details about payments to employees, tax deductions, National Insurance contributions, and student loan repayments.

Before RTI, employers submitted this information once a year through P35 and P14 forms. The shift to real-time reporting means HMRC receives up-to-date information throughout the tax year, allowing them to calculate tax codes more accurately and identify discrepancies sooner.

For East Yorkshire SMEs, this means your payroll processes need to be robust and timely. Late submissions attract penalties, and errors can result in employees receiving incorrect tax codes or facing unexpected tax bills.

The Key RTI Submissions You Need to Know

Full Payment Submission (FPS)

The FPS is your primary RTI report. You must submit this on or before each payday, including details of all payments made to employees and the deductions taken. This covers regular wages, bonuses, overtime, statutory payments, and any other taxable earnings.

The FPS includes employee National Insurance numbers, their earnings in the pay period, tax and NI deducted, student loan deductions, and pension contributions under auto-enrolment. Getting any of these wrong creates problems down the line.

Employer Payment Summary (EPS)

The EPS reports information that cannot go on the FPS. This includes recovery of statutory payments like Statutory Maternity Pay or Statutory Sick Pay, claims for Employment Allowance, and Construction Industry Scheme deductions suffered.

You submit the EPS by the 19th of the following month. If you have nothing to report, you do not need to submit an EPS. However, if you had no employees in a tax month, you should still submit an EPS to tell HMRC you made no payments.

Your RTI Compliance Checklist

Before Each Pay Run

Check that all employee records are current and accurate. This means verifying names match official documents, National Insurance numbers are correct, and tax codes are up to date. Any starter or leaver information should be processed before running payroll.

Ensure your payroll software is updated with the latest tax tables and thresholds. HMRC updates these annually, and sometimes in-year changes occur. Running payroll with outdated rates creates errors that compound over time.

Review any changes to employee circumstances. This includes address changes, changes to pension contributions, attachment of earnings orders, and updates to student loan plan types.

On Payday

Submit your FPS on or before the day you pay your employees. The submission must go through before midnight on payday. If you pay employees by BACS, remember that the payment date is when funds reach employee accounts, not when you initiate the transfer.

Check that the submission is accepted. HMRC sends back acknowledgements, and you should review these for any error messages or warnings. Address any issues immediately rather than letting them accumulate.

Monthly Tasks

Submit your EPS by the 19th if you need to claim statutory payment recoveries or report other information. Make your tax and NI payment to HMRC by the 22nd if paying electronically, or the 19th by post.

Reconcile your payroll records against bank statements to ensure all payments processed correctly. Keep records of any corrections made and maintain an audit trail of changes.

Year-End Requirements

Your final FPS of the tax year must be marked as such. This tells HMRC that all submissions for the year are complete. Issue P60s to all employees by 31st May following the end of the tax year.

Prepare P11D forms for any benefits in kind provided to employees during the year, unless you have registered to payroll benefits. Submit these by 6th July.

Common RTI Mistakes to Avoid

Late submissions are the most common problem. HMRC issues penalties for each month that an FPS is late, based on the number of employees. For smaller businesses, these penalties add up quickly and can become a significant cost.

Incorrect employee data causes ongoing issues. A wrong National Insurance number means deductions are not credited to the right person. Incorrect names can delay tax code updates and create problems when employees claim benefits or state pension.

Failing to report leavers properly is another frequent error. When an employee leaves, you must include their leaving date on the FPS. Missing this can result in tax code issues for the employee at their new job.

How Professional Payroll Support Helps

Managing RTI compliance requires attention to detail and consistent processes. Many East Yorkshire businesses find that the time spent on payroll administration takes them away from running their core business. The cost of getting it wrong, both in penalties and in fixing errors, often exceeds the cost of professional support.

A dedicated payroll service ensures your RTI submissions go in on time, every time. Your employee records stay accurate, and you have someone to call when HMRC queries arise. For businesses in Hull, Beverley, and across East Yorkshire, local expertise matters. Understanding regional employment patterns and having someone who can explain things in plain English makes a real difference.

If you are finding RTI compliance challenging, or simply want to free up time for your business, get in touch to discuss how outsourcing your payroll could work for you. We handle everything from weekly submissions to year-end filing, ensuring you stay compliant without the stress.