HMRC will introduce in-year penalties for failing to file PAYE submissions on time from 6 October 2014. Therefore, all submissions for your PAYE scheme should be up to date by 5 October 2014.
Penalties will apply if:
- A Full Payment Submission (FPS) has not been filed on or before the date employees were paid, or where HMRC have not been informed as to why you are late reporting to them.
- HMRC have not received the expected number of submissions.
Penalties will be charged for each tax month that submissions were not filed, i.e. if a weekly filer makes two (or more) late submissions within a tax month then only one penalty will be charged.
A penalty will not be charged for the first month in each tax year where filing was late. Therefore, HMRC can charge a maximum 11 fixed penalties during a tax year.
A penalty will not be charged to a new employer if the first FPS is received within 30 days of making the first payment to their employee(s). After that, normal penalty rules will apply.
Employers with nine or fewer employees and who meet certain conditions can take advantage of a relaxation for 2014-2015 and 2015-2016 (see http://www.hmrc.gov/payerti/transitional.pdf). This allows PAYE information about all payments in a tax month to be reported on or before the last payday in that tax month.
Filing penalties depend on the number of employees within a PAYE scheme, as follows:
Number of employees Filing penalty amount per PAYE scheme
1 to 9 £100
10 to 49 £200
50 to 249 £300
250 or more £400
If a return is late for three months or more HMRC may charge a further 5% of the tax/NICs that were due to be paid. This will only apply for the most serious and persistent failures.
HMRC will inform you on a quarterly basis when penalties have been incurred. Penalties should be paid within 30 days of the date of the notice to stop interest.