|
Employers with fewer than 50 employees will face automated in-year penalties for late real-time PAYE returns from March 6 next year. Those who employ 50 or more people will face penalties from October 6 2014.
HM Revenue and Customs (HMRC) will send electronic messages to all employers shortly to let them know when the penalties will apply to them, based on the number of employees shown in the department’s records.
Advertisement 
“We know from our experience of rolling out of RTI that to ensure a smooth transition for our customers it’s best to introduce changes in stages. This will allow us to update our systems and enhance our guidance and customer support as needed. We know that those who have had most difficulty adjusting to real-time reporting have been small businesses, so this staged approach means they have a little more time to comply with the new arrangements before facing a penalty.
“We believe this is the best approach for HMRC and our customers, as we all get used to the new in-year penalties.”
Where employers believe they have a reasonable excuse for sending a return late, they will be able to appeal using HMRC’s new, online appeals process for automated penalties. This should speed up the appeal process for businesses and HMRC.
In the run up to March 2015, HMRC will examine other ways to encourage employers to comply with the rules, in addition to financial penalties.
Positive step
The Chartered Institute of Taxation (CIOT) hailed the announcement as a positive step in helping small business transition into the new PAYE reporting method, but says wrinkles remain in the overall system.
Colin Ben-Nathan, Chairman of the CIOT Employment Taxes sub-committee, said: “The Institute welcomes this delay until March 2015 as regards the issuing of automated PAYE RTI late filing penalties for small employers. Smaller employers, in particular, need a longer period of time to adjust to PAYE and other administrative changes because they have very limited resources which are primary geared to servicing their clients and customers. So it is encouraging to see that the Government have recognised this point in the present circumstances.
“However, we think that HMRC still has work to do in ensuring the accuracy of automated generic notification messages to employers. An improvement in the accuracy of the late filing, non-filing and late payment messages would not only reduce the volume of penalties issued in error by HMRC, but would also reduce the number of appeals that inevitably result from this.
“Additionally, we consider that HMRC needs to do more to make speedier use of the RTI data it is receiving to improve the accuracy of PAYE deductions for employees and pensioners.”
--
If you wish to comment on this article, please log in and use the Reply button below. Registering is free and easy - see 'Join Shout99'.
-
Susie Hughes © Shout99 2014
|
