PAYE Penalty Notices to be Sent In-Year

HMRC is planning to send penalty notices for late or missing monthly tax payments within the tax year as opposed to after April 19, which its current policy.

Many people have criticized the current regime for punishing employers by not been giving them a chance to rectify any mistakes that may have been made in their payment systems. As it stands, employers become aware of late or missing payments after the end of the tax year, by which time interest is charged on the underpayment.

The reason for this is that HMRC does not become aware of the tax and National Insurance due by employers until figures are submitted at the year end.

From October 2013 though, employers will not only have to make PAYE and NI payments every month; they will also be required to file monthly returns.

An HMRC spokesman has said that notices will now be sent as and when they occur.

Ricky Steedman