RTI penalties delayed for smaller firms

HM Revenue & Customs (HMRC) has announced that the introduction of automatic penalties for late real time information (RTI) submissions will be put back for smaller employers.

Automatic penalties were due to start for all employers from 6 October 2014 but on 9 September, HMRC said that employers with fewer than 50 employees would not face automated in-year penalties for late RTI PAYE returns until 6 March 2015.

Those who employ 50 or more people will still face penalties from 6 October 2014.

HMRC said it would be sending electronic messages to all employers to tell them when the penalties would apply to them, based on the number of employees shown in its records.

Ruth Owen, the HMRC’s director-general for personal tax, said: “Our most recent figures show that over 95 per cent of PAYE schemes making payments to individuals are successfully reporting in real time.

“We know that those who have had most difficulty adjusting to real time reporting have been small businesses, so this staged approach means they have a little more time to comply with the new arrangements before facing a penalty. We believe this is the best approach for HMRC and our customers, as we all get used to the new in-year penalties.”

Where employers believe they have a reasonable excuse for sending a return late, they will be able to appeal using HMRC’s new, online appeals process for automated penalties.

Link: HMRC RTI guidance