It must be stressed that the changes implemented by HMRC relate to the manner in which they collect information on payments made to employees. There has been no change in the law insofar as it relates to the calculation of tax liabilities; the changes apply to all employers, it is not a system targeted at shooting. The main intention is to provide HMRC with information that shows, in real time, how much PAYE and NIC employers are due to remit, so that businesses are prevented from using tax monies as a source of finance. RTI (Real Time Information) is also intended to provide HMRC with up to date information so they can deal with individual taxpayers’ affairs in a more timely fashion.
Notwithstanding this, shoot organisers must keep a record of all payments made to shoot workers, including sufficient detail to enable the individual recipients to be identified, (proper names, address etc.) otherwise the shoot organiser could be exposed to tax and/or NIC liabilities in the event of an HMRC inspection. These records must be kept for three years. This is not a new rule; it has always been a requirement.
Moving on to RTI – many shoots employ a keeper and are therefore already accounting to HMRC for PAYE and NIC. For such permanent employees, the RTI system will have to be used every time the payroll is run, and in these cases you must extend its use to reporting, on a weekly basis, on payments made to casual employees such as beaters. However, unlike the returns required for permanent staff, you do not have to report on daily casuals until after they have been paid. These reports are required even when there is no PAYE or NIC to account for.
Most small shoots will not have to report beaters’ pay to the tax authorities. Provided the shoot has no employees from whom it is liable to deduct PAYE or account for National Insurance, and none of the beaters is paid more than the National Insurance Lower Earning Limit (LEL) (currently £118 per week) HMRC says there is no need to make a submission if:
- The beater works on a casual daily basis
- Is taken on for one day or less
- Is paid off at the end of that period
- Has no contract for further employment.
HMRC has confirmed that although there is no requirement to make a submission using RTI – the on-line reporting system that was introduced in April 2013 – as before, shoots should keep records of all the payments they make and retain those records for at least three years.
Beaters and pickers-up should remember, however, that the money they earn is taxable.
There never has been an issue for those shoots that do not pay their beaters, but those shoots that are making payments to helpers that should have been reported to HMRC are as much in breach now as they will be if this pattern continues with the introduction of the Real Time Information system.
Please understand that this is essentially a recitation of the legal position that makes no recommendations regarding the approach shoots should take to managing their financial arrangements. While BASC will do what it can, it is a shooting body, not a tax adviser, and is therefore not equipped to advise shoots on their individual circumstances. Clearly, it will be appropriate for some to seek proper professional advice.