SWINDON firms have been warned to start thinking now about filing their tax returns over the internet.

In the next six years before 2009/10 all employers will have to file the end-of-year PAYE forms through the internet.

From this year businesses with more than 250 employees will e-file the year's returns, while, those between 50 and 250 will follow suit the next year.

Everyone else will be required to efile by 2009/10.

Sharon Omer-Kaye, specialist tax partner at Morris Owen chartered accountants, who has worked for the Inland Revenue, said: "It is expected that by October the Inland Revenue will have notified employers as to whether they are classed small, medium or large and whether you are expected to file by the internet for 2005/6.

"This will be based on how many live employees are on the payroll. You will however have to check your obligations, particularly if your employee numbers change, resulting in a move between two categories."

Morris Owen has warned that all companies need to be thinking now about when the time will come to file tax returns electronically, and to make sure that payroll software is up to scratch.

There are also incentive payments up to £250 available for small businesses to start using the internet earlier than scheduled.

Sharon said: "It's important that employers of less than 50 employees claim these incentive payments and those with more than 250 employees in Swindon remember that this will be mandatory by 2004/5 and for those with 50 or more by 2005/6.

"It is best to seek advice from an expert now rather than in six months' time."