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Rather than issue late filing penalties automatically when a deadline is missed, HMRC has said it will take 'a more proportionate approach and concentrate on the more serious defaults on a risk-assessed basis'.
This approach is in line with the likely direction of HMRC’s general approach to penalties, outlined in a discussion document which it issued earlier this year and in HMRC’s fresh approach to considering appeals against late filing penalties for Self Assessment. (See: Taxman relaxes late payment penalties - Shout99, June 2015).
Late reporting penalties already apply to employers with 50 or more employees, so this ‘risk-based’ approach will apply to submissions that were late from:
- March 6, 2015 for employers with fewer than 50 employees, and
- January 6, 2015 for employers with 50 or more employees.
HMRC will continue to issue risk-based penalties for the tax year 2015 to 2016 tax year.
Help rather than penalise
HMRC says that it does not want to charge penalties, but wants employers to report on time. It wants to help employers who are trying to do the right thing, rather than penalise them.
Freelancers Outside IR35This move to issuing risk-based late filing penalties also continues HMRC’s strategy of adapting its approach, where necessary, before moving to the next phase of implementation.
This approach is intended to enable HMRC to concentrate more resources on the more serious failures to comply, and to focus on educating employers about their filing obligations through targeted communications, webinars and Employer Bulletin articles.
It applies in addition to HMRC’s recent announcement that it will not be penalising minor delays of up to three days. HMRC will monitor both, and review by April 2016.
Even if employers do not get a penalty, they are required by law to file on time and if they do not may be charged a penalty on a future occasion. The deadlines for sending PAYE information stay the same, including the requirement to send PAYE information on or before the time that employees are actually paid or due to be paid.
Employers can appeal electronically using the Penalties and Appeals System (PAS) on HMRC Online.
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Susie Hughes © Shout99 2015
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