The draft Income Tax (Pay As You Earn) (Amendment) Regulations 2024 will not be progressed further.
The draft Income Tax (Pay As You Earn) (Amendment) Regulations were due to come into force on 06 April 2025 and were presented for consultation on 14 March 2024. The Regulations would have required the Full Payment Submission (FPS) to include more details about the hours worked by an employee in the pay reference period. This may have been:
- Actual hours worked: or
- Contractual hours worked
Via successive Wages Wednesdays Ian Holloway commented that the proposals would have posed a huge data gathering and reporting obligation on both employers and the processors of their payroll, e.g. bookkeepers. The initial data gathering was estimated as an initial £58 million cost to businesses and a £10 million ongoing cost. Plus, he questioned whether this increased data gathering and reporting would have led to improvements in the quality of data that HMRC holds.
HMRC communicated with software developers on 15 August 2024 as follows:
Due to delays owing to the General Election and the lead-in time required to upgrade software and processes to prepare for implementation, employers will now not be required to start providing more detailed employees’ hours data through PAYE Real Time Information returns from April 2025. This requirement will not apply until April 2026 at the earliest. Final decisions on whether to go ahead with the regulations and any timelines will remain subject to decisions by the new government.
Further guidance on the above measures will be provided when available.
In short, the proposal was not going ahead but may have been implemented from 2026.
On 28 January 2025, a consultation outcome was published and, just regarding the possible requirement to gather and submit hours via RTI, this said:
The draft Income Tax (Pay As You Earn) (Amendment) Regulations 2024 will not be progressed further. The government has listened to businesses and acted on their feedback about the administrative burden the requirements in these regulations would bring. The current requirement for employers to report normal hours worked will continue.
In short, the proposal to require the reporting of hours has been abandoned altogether.
For Bookkeepers
This announcement is more welcome than the announcement of a delay. It seems that the UK Government and HMRC have listed to the views expressed in the consultation, a clear reason that we need to respond to open consultations.
