1) How willing are HMRC to reduce (automatic) penalty of £400 for late P11D?
2) Is it worth arguing with HMRC?
Replies (6)
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Would you care to expand?
Your brief description of your question has evidently been truncated:
"Company forgot to submit P11D (2014/15) for director's car (first year) but has entered car ben"
If you include the full description in the body of your question, it would give us the context - where has the car benefit been entered?
No defence
The director may pay tax on the BIK via his tax return, but the company will not have paid over the Class 1A NIC due on the BIK if it has not submitted a P11D(b).
Guilty as charged!
So it isn't a late return (penalties hardly ever issued unless P11D requested) but an incorrect Return.
It will almost certainly be deemed careless but if you get in there unprompted you can minimise penalties, possibly even to nil. Personally I would get the position resolved before submitting the director's SATR in case they 'discover' it from the Return before you come clean
The maximum penalty will be £3000 but cooperation, disclosure, and honesty is your friend there. If they wont go low enough, ask for a suspended penalty.
There'll be interest on the Class 1A