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Penalties in Company P&L

Hi, how would you treat late filing & interest penalties in company accounts,ie would you put in P&L and add back in tax comp.

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04th Aug 2011 12:02

Yes and no

Late filing penalties - yes

Interest for late payment of tax - no (the rule changed several years ago)

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04th Aug 2011 12:30

I am intrigued

If you are not going to put them on the P&L where would you put them?

PS Peter is right only penalties should be added back.

 

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By CEL
04th Aug 2011 13:54

Interest re late payment of tax

I believe that it is only interest on late payment of CT that is deductible, if it relates to PAYE/NIC (including any arising on BPSS deferrals) then it is not.

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04th Aug 2011 14:04

"if it relates to PAYE/NIC

"if it relates to PAYE/NIC (including any arising on BPSS deferrals) then it is not."

There isn't any interest - it's a penalty.

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By Old Greying Accountant
04th Aug 2011 15:42

So how come

I have 2 DNP1's that arrived in the post today in respect of underpaid PAYE that both show "interest to date"? 

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04th Aug 2011 16:16

Claim all interest?

Sorry, I was thinking about the penalties that have recently been introduced.

Why can't you claim the interest on late PAYE and NIC?

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By CEL
04th Aug 2011 17:26

It is not allowed by law

http://www.hmrc.gov.uk/manuals/bimmanual/BIM45740.htm 

 Updated reference: ITEPA 2003 s684 (4)

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