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Late Filing Penalty Regime For Payroll Real Time Information (RTI)

As you are aware from 6th April 2013 the Government introduced a new way of operating the Pay As You Earn (PAYE) scheme for most employers. The new system is called Real Time Information (RTI).

We wrote about the changes in our November 2012 e-shot newsletter, and below is the link to the article

This was a major change in how businesses operated payroll. The requirement to submit payroll information to HMRC each time you pay someone is onerous. The Government recognised this and offered a “soft landing” for smaller employers. That meant they would not enforce the rather strict penalty regime, as outlined below, for late RTI submissions.

How much you’re charged depends on how many employees you have.

Number of employees Monthly penalty
1 to 9 £100
10 to 49 £200
50 to 249 £300

If you’re over 3 months late you can be charged an additional penalty of 5% of the tax and National Insurance that you should have reported. If you run more than 1 PAYE scheme, you can be charged penalties for each.

HMRC’s “soft landing” has now come to an end and these penalties will be levied from 6th March 2015.

The new penalty regime does increase the risk that you will incur fines if the payroll processing is delayed or inaccurate.

Please do not hesitate to contact us on 0161 832 4451 if you would like to discuss this matter further.