Monday, 3 December 2012

RTI – penalties approach published by HMRC

HM Revenue and Customs (HMRC) has published guidance on penalties for late and inaccurate returns submitted in real time (RTI).

The guidance sets out that for employers operating PAYE in real time:

  • There will be no penalties if in-year Full Payment Submissions (FPS) are sent in late, until April 2014. The current penalty process will continue to apply at the year end, with a penalty being charged if the relevant information is not up to date by 19 May. From October 2013, HMRC will send letters so that employers understand that they would have been liable to a penalty.

  • There will be no automated late payment penalties until April 2014. The current processes will remain until then. HMRC will use real time information to collect late payments.

  • For the tax year 2012-13, HMRC will not charge penalties for inaccuracies identified on in-year FPSs. But penalties may be charged after the end of the tax year, based on the final FPS for the year.

  • For the tax year 2013-14, if we discover inaccuracies on FPSs, in-year penalties may apply. HMRC will use the same considerations as now to identify employers for compliance visits. If HMRC discovers inaccuracies as a result of a review, it will use the same criteria as now to decide whether a penalty applies and if so, how much it should be.

The full guidance is published here

Information on real time information and late payment has also been published as a What's New item.

Suzanne Newton, Programme Director for Real Time Information, said:

“After stakeholder consultation, we have published our guidance on late and inaccurate returns sent in real time. This will give most employers a year to get used to reporting in real time before implementing the new penalties.

“The delivery of PAYE real time reporting is on track. HMRC has been piloting RTI since April 2012 and it is going really well.”

Find out more on the HMRC website.

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