PAYE Real Time Information (RTI): What Every Employer Must Know

Every UK employer running a payroll must report pay, tax, and National Insurance to HMRC in real time. This system, known as Real Time Information or RTI, replaced the old year-end reporting model in 2013. If you get it wrong, penalties can start accumulating from the very first late submission.

This guide covers exactly what you need to submit, when to submit it, and how to avoid the most common and costly mistakes.

What is Real Time Information?

RTI requires employers to send payroll information to HMRC every time they pay their employees, rather than once at the end of the tax year. The data is sent electronically through your payroll software using two main submission types: the Full Payment Submission (FPS) and the Employer Payment Summary (EPS).

The Full Payment Submission (FPS)

The FPS is the core RTI submission. You must send one to HMRC every time you pay an employee. It contains details of each employee's pay, tax deducted, NI contributions, student loan deductions, and pension contributions.

What the FPS includes

Each FPS contains employee-level data:

• Employee name, National Insurance number, and date of birth
• Tax code and NI category letter
• Gross pay in the pay period
• Tax deducted in the pay period
• Employee and employer NI contributions
• Student loan and postgraduate loan deductions
• Pension contributions (employee and employer)
• Hours worked (for employees paid hourly)
• Starter and leaver information where applicable

When to submit the FPS

The FPS must reach HMRC on or before the date you pay your employees. This is the critical deadline that catches many employers out.

Situations where a late FPS is acceptable

HMRC allows a small number of exceptions where the FPS can be sent after pay day:

• Your first ever payroll submission (you have up to 30 days)
• You pay employees in advance of their normal pay day (for example, before a bank holiday)
• HMRC's online service is unavailable on pay day

Even in these cases, submit as soon as possible. Do not treat these exceptions as routine.

The Employer Payment Summary (EPS)

The EPS is a secondary submission used to tell HMRC about adjustments to your overall PAYE liability. You do not send employee-level data on an EPS — it covers employer-level information only.

When to send an EPS

You need to submit an EPS if:

• You are reclaiming statutory payments (SSP, SMP, ShPP, SAP, SPP, SPBP)
• You are claiming the Employment Allowance
• You had no employees to pay in a tax month (a nil EPS)
• You are claiming the NI holiday for veterans or Freeport employees
• You need to report a CIS deduction suffered

EPS deadlines

The EPS must be submitted by the 19th of the month following the tax month. Tax months run from the 6th to the 5th (for example, tax month 1 runs from 6 April to 5 May, and the EPS for that month is due by 19 June).

The final EPS for the tax year must be submitted by 19 April following the end of the year. This is the submission where you indicate it is your final report for the year.

RTI penalties: what you face for getting it wrong

HMRC takes RTI compliance seriously. Penalties apply for late submissions, inaccurate information, and failure to file.

Late filing penalties

Late FPS penalties are charged per month per employee, based on the size of your business:

These penalties are charged for each tax month where one or more FPS submissions are late. A single late submission in a month with 5 employees costs the same as 5 late submissions in that month — but the penalty applies every month you are late.

Inaccuracy penalties

If you submit incorrect information and do not correct it, HMRC can charge inaccuracy penalties of up to 100% of the tax underpaid as a result. In practice, penalties for genuine mistakes are lower (typically 0-30% for careless errors), but deliberate inaccuracies attract the full rate.

Late payment penalties

Separate from filing penalties, HMRC charges penalties for late payment of PAYE and NI. If you pay late more than once in a tax year, the penalty rate increases:

• 1st late payment: no penalty
• 2nd to 4th late: 1% of amount outstanding
• 5th to 7th late: 2% of amount outstanding
• 8th to 10th late: 3% of amount outstanding
• 11th or 12th late: 4% of amount outstanding

Setting up RTI correctly

Payroll software requirements

You must use HMRC-recognised payroll software to submit RTI. This can be commercial software (such as Sage, Xero, or QuickBooks), HMRC's own Basic PAYE Tools (suitable for employers with fewer than 10 employees), or a payroll bureau acting on your behalf.

Getting your employee data right

RTI submissions are matched to HMRC records using National Insurance numbers and dates of birth. Before your first submission for any employee, verify their details using HMRC's online service or your payroll software's verification tool.

Common data problems that cause RTI rejections:

• Incorrect or missing NI numbers
• Wrong date of birth
• Name mismatches (especially after marriage or deed poll changes)
• Incorrect tax code (always use the code on the employee's P45 or HMRC's starter checklist coding)

Correcting RTI mistakes

If you discover an error in a previous FPS, submit a corrected FPS as part of your next regular payroll run. Your payroll software should calculate the year-to-date correction automatically.

For the current tax year, corrections can be made on any subsequent FPS. You do not need to contact HMRC separately. For previous tax years, you may need to submit an Earlier Year Update (EYU) or contact HMRC directly, depending on when the error occurred.

RTI and your employees

Your RTI submissions directly affect your employees in several ways:

• Tax codes: HMRC issues and updates tax codes based on RTI data. Errors in your submissions can result in employees paying the wrong amount of tax
• Universal Credit: Claimants' benefit payments are adjusted monthly based on RTI earnings data. A late FPS can cause payment disruptions for your employees
• Student loans: Deduction rates are calculated from RTI data. Incorrect submissions can lead to over- or under-deduction
• State Pension: NI contributions reported through RTI build employees' State Pension entitlement

Frequently asked questions

Next steps

Key takeaways

RTI compliance comes down to three habits: submit your FPS on or before every pay day, send an EPS when you have adjustments or nil months, and keep your employee data accurate. Most penalties stem from late FPS submissions and missing nil month returns — both entirely preventable with the right processes.

If you are calculating payroll manually, use our Payroll Tax Calculator to verify your PAYE and NI figures before submission. For more on National Insurance rates and thresholds, see our NI rates guide for 2025/26.