RTpay: A real time PAYE collection system

Real Time PAYE is an effective and efficient approach for developing countries.

RTpay is a not for profit organisation which actively promotes and helps develop innovative Real Time solutions using modern, tried and tested, Real Time technologies.

We work with governments, tax authorities, fraud analysis and transaction specialists, credit card companies and banks to create Real Time solutions and approaches for national and international information and financial transfers.

To find out more about our Real-Time tax solutions: > contact us

> See a video conversation with Chris Williams, Chair of RTpay and RTvat, on how technology can be used to combat fraud and increase the efficiency of tax collection.

Chris outlines the principles of the RTpay solution and how RTpay is working with developing countries to establish centralized payment systems to increase revenue and reduce non-collection and the adminstrative burden on businesses.

> See Chris Williams' RTgovernment blog

Real Time tax collection

The advantages of Real-Time collection can be applied not only to indirect taxes such as VAT but equally to a range of other national and international central financial collection and distribution systems, including PAYE and Benefits Payments.

RTvat is working proactively with a number of governments and organisations to develop systems which are efficient, effective and resistant to fraud.

Working with tax authorities and tax organisations worldwide

RTpay are proactive in working with national and international groups to support the use of innovative technology solutions in tax collection. We provide technical expertise, consultancy and application solutions on a not-for-profit basis.

In conjunctions with S4TP (the South-South Sharing of Successful Tax Practices) and on behalf of the UN Committee of Tax Experts' subcommittee on Capacity Building, RTpay have developed an innovative online community for the sharing of best practice for tax professionals worldwide, with a particular emphasis on the developing economies.

The Real-Time Solution for PAYE

In our solution the employer pays the gross amount of salary to the Central Clearing Point System (CCPS) for all employees in one single transaction. When taking on a new employee, the employer only has to check the Tax Identity Number (TIN) of the employee and enter that against the amount to be paid.

The employer is no longer responsible for calculation of the taxes, or for having to adjust for any changes in rates or allowances. This reduces the administrative burden dramatically and therefore represents a major saving for the employer. Apart from the benefit to the economy overall, there is a greater chance of persuading more companies to move to a PAYE system when it is this simple to activate and operate.

The amount of data needed on each employer and employee is simply compiled and can be kept at the CCPS for each local or central tax authority. When an employee moves to another tax area, there is no loss of data on taxes to date, so the new tax collection can continue without hindrance or error.

Components of the real time system

• The clearing system resides on a network of servers, one dedicated to each local tax authority and one to the central tax authority.
• The data is divided between confidential data for the local area and that which is for sharing at general level, either in detail or as part of grand totals.
• The fraud analysis tool is similarly operated at the CCPS, both locally and nationally. This tool provides real time reporting of suspicious transactions, so that any payments can be delayed.
• The CCPS works on physical movement of electronic funds with the Central Bank (or other approved financial body) controlling all payments.
• The main purpose of CCPS is to separate out the tax due on any transaction during the payment flow – and pay it directly to the appropriate tax authority.
• All tax authorities have bank accounts at the Central Bank, so collection of taxes is immediate, i.e. in the same 24 hour time as received.

To find out more about our Real-Time tax solutions: