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Pay As You Earn (PAYE) late filing penalties

From 5 March 2015 HM Revenue & Customs (HMRC) brought in penalties for all employers who report their payroll information late, or don’t report it at all.
Penalties will be issued for:

  • sending a late Full Payment Submission (FPS)
  • not sending an Employer Payment Summary (EPS) when no employees were paid
  • not sending the expected amount of FPSs

The penalty amount increases in relation to the number of employees and is split into four tiers:
The first tier applies to those with 1 – 9 employees with a penalty charge of £100.
The second tier applies to employers with 10 – 49 employees with a penalty charge of £200.
The third tier applies to employers with 50 – 249 employees with a penalty charge of £300.
The fourth and highest tier for applies to those with 250 or more employees and holds a penalty charge of £400.

It is therefore vitally important that if you run your own payroll you send the appropriate information to HMRC on, or before, payday.  If you outsource your payroll it is important that you supply your provider with your information in ample time for them to process and report the relevant information to HMRC.  

HMRC have applied three exceptions to the penalty charge if an FPS is received late which are:

  • if your FPS is late but received within 3 days of the pay date (for all employers up to 5 April 2016)
  • if you are an existing employer with 9 or fewer employees and are using the temporary relaxation rule (please ensure that you use the appropriate late reporting code of E for this)
  • if you are a new employer sending your first FPS within 30 days of the first pay date

For more information on the PAYE penalties or to find out how we can remove the payroll burden from your business call one of our experts on 01228 711888.

Posted: May 14th, 2015

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