PAYROLL - 21.12.2012

RTI penalty guidance published

From April this year your company will need to submit the information about all PAYE payments to HMRC online on or before the time employees are paid, rather than at the end of the year, as you do now. The submission you will need to make on or before each payday is called the Full Payment Submission (FPS). The new system is likely to pose challenges for employers so will you be penalised if you make a mistake?

Late returns. Last month HMRC issued guidance which states that it will not issue penalties for in-year FPSs sent in late until April 2014. However, the current (P35) penalty process will continue to apply at the year-end so you will still need to get the information up to date by May 19 following the end of the tax year. In October 2013 HMRC will send out letters to employers to show when they would have been liable to a penalty, helping them to correct their mistakes for the following tax year.

Late payments. The guidance also confirms that there will be no automated late payment penalties until April 2014. However, for 2012/13 and 2013/14, the current late payment penalty regime remains in place. HMRC will continue to use a risk-based approach to identify employers who are not complying with their payment obligations and so might be liable to late payment penalties.