More information on penalties for late real-time PAYE returns

10 September 2014


HMRC have now clarified their plans in a number of respects:

Supporting communications in September


HMRC will shortly begin sending electronic GNS messages to all employers. These will confirm when the new in-year penalties will apply, based on the number of employees shown in their records.

For guidance on how to view GNS messages go to the “Online notices - Generic notification service (GNS)” section of the Using HMRC's Online Service - PAYE for employers internet guidance page.

From 19 September 2014 they will also issue letters to employers whose records indicate that they have:

· 50 or more employees; and

· received more than one late/non filing GNS alert in recent months

The aim of this letter is to alert them that they may face penalties from October 2014 if they do not file on time. It also provides helpful practical information about how they can avoid these penalties.

HMRC have also shared for information:

· the text of the two GNS messages - one for employers with schemes of 50 or more employees, the other for all other employers - that they plan to issue in September

· the letter

End of Year penalties for 2013-14

HMRC explain that the new in-year penalties replace the end of year penalties, which apply up to and including the 2013-14 tax year.

They will issue end of year penalties from late September, for employers who they believe failed to send their final submission for 2013-14 when one was expected and remains outstanding, or where the employer has not yet told HMRC that one wasn’t due.

The normal appeal process will apply to these penalties. The new on line appeals service may only be used to appeal the new in-year penalties.

PAYE and Universal Credit

HMRC say that they want employers to report their PAYE correctly and on time rather than incur penalties. For the purpose of Universal Credit (UC), reporting PAYE in real time on or before each payment date (and the correct use of the ‘hash’ cross reference where this is relevant) improves benefit administration; making it easier for Universal Credit claimants and minimising contact between employees who claim UC and their employer.


CIPP comment


The Policy team are pleased about the common sense approach behind the phased introduction and the advance warnings to those at risk of penalties.