HMRC cancels plans to mandate employee hours reporting in PAYE submissions

What was originally proposed?

As part of wider HMRC RTI reporting changes, the government had planned to introduce a new requirement for employers to report more detailed information on hours worked by individual employees through their Real Time Information (RTI) PAYE submissions. Initially scheduled for April 2025, the implementation was deferred to April 2026 in response to concerns raised by employers.

Why has the proposal been withdrawn?

In a welcome move for businesses, HMRC has now formally cancelled the proposed reporting obligation. The decision was confirmed in the February 2025 edition of the Employer Bulletin, where HMRC stated:

“The government has listened to businesses and acted on their feedback about the administrative burden the PAYE data requirements would bring.”

This means that employers will not be required to report hours worked via RTI submissions from April 2026 onwards, as had previously been expected.

What employers still need to know

While the new RTI reporting requirement has been scrapped, other compliance obligations remain firmly in place:

• National Minimum Wage: Employers are still legally required to maintain accurate records of all hours worked by their employees, in order to meet minimum wage obligations.
• Minimum Wage Rates Update: With updated National Minimum Wage rates in effect from 1 April 2025, it is more important than ever for businesses to ensure that all working time is correctly recorded and paid.
• Ongoing HMRC Developments: Although this particular reporting requirement has been withdrawn, HMRC has confirmed its continued commitment to broader data and system reforms. As stated on GOV.UK (28 January 2025):

“The government remains committed to data transformation and will continue to focus on other initiatives delivering improved data, including Making Tax Digital for Income Tax Self-Assessment, digitalising business rates, and investing in our IT infrastructure.”

Staying compliant amid changing requirements

The removal of the RTI hours reporting requirement provides welcome administrative relief, but businesses should not let their guard down. Now is a good time to:

• Review your current payroll and time-tracking processes
• Ensure you have robust systems in place to maintain compliance with National Minimum Wage legislation
• Prepare for the ongoing changes to HMRC’s wider data reporting initiatives

Get in touch

Our experienced payroll and employer compliance team can support you in navigating these changes with confidence. Whether you need help reviewing your PAYE processes, minimum wage compliance, or preparing for other legislative updates, we’re here to help.

Contact our payroll services or employment tax specialists today to discuss how we can support your business.