Employers continue to face problems under the new real time information (RTI) PAYE reporting scheme, particularly when reconciling the differences between the tax HMRC says is due and the tax they think is due.

Although the latest report by HMRC shows no evidence that HMRC IT systems are calculating the PAYE charge incorrectly, the tax office says that the problems in reconciliation have arisen because some employers did not understand how the tax office calculated the employer charge.

However, it is not only the employers who are confused by the new RTI system. The report said that there were also internal issues at HMRC, which found that some of its contact centre advisers lacked detailed knowledge which has resulted in 'some employers being led to believe that their liability and payment had been calculated incorrectly'.

HMRC says that it is clear from the analysis that it would be helpful to increase knowledge of how the employer charge is created - both internally in HMRC and externally with employers and their agents.

The report also identified a number of compliance issues which were causing discrepancies in the reporting process under RTI. These include miscellaneous employer error; Employer Payment Summary (EPS) returns; payments to leavers; the timing of updates to HMRC's Business Tax dashboard; and issues relating to returns for Construction Industry Schemes (CIS).

The report stresses that the number of charges being queried is less than 1% of the 1.6m RTI-reporting PAYE schemes, and the majority of discrepancies have been due to misunderstanding, error or transitional issues as employers joined RTI.

HMRC recommends that employers and payroll service providers check HMRC's guidance or liaise with their payroll software provider where they are unsure.

The report is available from GOV.uk. Click HERE