HMRC has announced that the temporary relaxation of PAYE reporting arrangements for smaller business has now been extended to April 2014. Smaller businesses are reminded that this relaxation does not mean that they do not need to file in real time at all until the relaxation ends; they are still required to report PAYE at least once a month until the end of the relaxation. The decision was taken after feedback from stakeholders.

Readers are reminded that this relaxation is only available to businesses with fewer than 50 employees. The relaxation was due to end on 5 October 2013 and will now run until 5 April 2014. It should be stressed that the relaxation will come to an end at this point. This extension means that businesses will not be required to change their approach halfway through the tax year.

The relaxation means that these businesses are still required to report through the new system, but are able to do so once a month, rather than each time they pay their employees. This gives small businesses that pay weekly (or more frequently), but who only run their payroll at the end of the month, some extra time to adjust to the new requirements.

From April 2014, all employers need to plan to be reporting in real time, but HMRC have advised that they will continue to work with stakeholders and businesses over the coming months to identify whether there are any specific circumstances with ‘on-or-before reporting’ that it needs to cater for in the longer term.

An extract from HMRC's announcement is repro-duced on page 24 for your convenience.