Employers look out!! - Help from David Lyttle Cookstown

RTI Penalties for late filing on their way!

Employers who report their payroll information late or inaccurately face penalties from  6 October 2014.  However, HMRC announced that penalties will now be phased in with penalties starting on 6 October 2014 for schemes with 50 or more employees and on 6 March 2015 for all other schemes.

Automatic in-year penalties for late payment to HMRC of employee-related payments and CIS deductions are due to start from April 2015.

HMRC has recently published guidance on late filing and late payment penalties which apply to employers filing under real time information (RTI) in addition to an up to date Penalties and Appeals Helpsheet. It is intended that HMRC will begin issuing penalty notices for the new in-year penalties early in 2015.

Penalties may be charged if:

·  The Full Payment Summary (FPS) was late

·  The employer didn’t send the expected number of FPS’s

·  The employer didn’t send a nil or no activity Employer Payment Summary (EPS) when no employees were paid in a tax month

HMRC won’t charge a penalty if:

·  it’s the first late report of the tax year

·  an employer is new and sends in their first FPS within 30 days of paying an employee

The rate of late filing penalty will depend on the number of employees. Filing over three months late attracts an additional penalty of 5% of the tax and NIC that should have been reported. If the penalty is not paid within 30 days, interest will be charged. Appeals will be able to be made online or by letter. HMRC’s guidance outlines some acceptable grounds for appeal. Employers who believe they have a reasonable excuse for filing late will be able to appeal using the new online appeals system once they have received a penalty notice.