Payroll – late filing penalties 2021-22

HMRC have issued the following comments on their adoption of a risk-based penalty strategy for 2021-22. They said:

Following HMRC’s review of the effectiveness of the risk-based approach to late filing PAYE and late payment penalties, we can confirm this approach will continue for the 2021 to 2022 tax year. This means that late filing and late payment penalties will continue to be considered on a risk-assessed basis rather than issued automatically.

The first penalties for this tax year (beginning 6 April 2021) will be issued in August 2021.

Late filing penalties

As in previous years we will also continue to not charge penalties automatically if a Full Payment Submission (FPS) is filed late but within 3 days of the payment date and there remains no pattern of persistent late filing. This is not an extension to the current statutory position on reporting PAYE payments which remains unchanged.

Employers are still required to file their submissions on time unless any of the circumstances set out in the sending an FPS after payday guidance arises.

Employers who persistently file after the statutory filing date but within 3 days, will continue to be monitored and may be contacted or considered for a late filing penalty as part of our risk-based approach.

Late payment penalties

The due date to make PAYE payment to HMRC electronically remains the 22 of the month (or quarter if you are eligible to pay quarterly) following the tax month/period to which they relate. If you pay by cheque or other non-electronic payment methods, you must continue to make payment by 19 of the following month or quarter to which the payment relates.

How to pay your PAYE guidance is available.

If you pay late, we may charge interest on the amount outstanding which will continue to accrue until the total amount is paid.

You may also face a late payment penalty which we will continue to raise using a risk-based approach. This will focus on cases of greatest risk and non-compliant behaviour. There is guidance on how we calculate late payment penalties and how employers can appeal them.

If you have concerns that you will struggle to meet the demands of running your own payroll, we can help. Please call so that we can discuss your options.

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