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Agents no longer to receive RTI penalty notices

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19th Dec 2014
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Accountants and payroll providers will now not be notified when a client receives an RTI penalty, HMRC has said, in addition to relaxing the need for employers to answer extra questions on the FPS.

In a recent employer bulletin from the Revenue in December, it said "agents will not be sent a copy of the penalty notice", but any notices would contain a "prominent message" telling employers to show their agent the notice immediately.

Each penalty on the notice will have a unique ID number to help employers identify the penalty should they want to appeal.

HMRC also said an automatic generic message will be sent to employers to advise when they fall into a penalty position, although this is not a penalty notice.

Accountants are worried that this may leave them unaware of penalties clients will need to pay. 

The Revenue has also released a Tax Information and Impact Note (TIIN), entitled 'Improving the operation of Pay As You Earn'. Included in this is an announcement that employers won't need to answer extra questions on year-end submissions to HMRC. 

Under RTI those running payroll need to report employees’ pay and deductions to HMRC in regular Full Payment Submissions (FPS) through the year. A final end of year FPS must be submitted by 19 April.

The extra questions were inherited from the old form P35 which had a submission deadline of 19 May.

President of the AAT Natalie Miller has welcomed this change, as it is something the body has been asking for. 

"We are pleased that HMRC have consulted and taken our comments and concerns on board. Many of the questions could not be answered correctly until after the tax year had ended on 5 April, so this really did squeeze the time employers had to submit the FPS into a very short period of 14 days. 

“Now freed of the requirement to answer these questions, employers should be able to file much quicker than before and hopefully avoid a backlog of submissions being made very near the deadline, which always makes an electronic system vulnerable to crashes and disruptions," she said. 

Chairman of the ICAEW tax faculty tech committee Paul Aplin said that this is the result of the Revenue and Admin Burdens Advisory Board - of which he is a member - having set up a working group earlier this year to look at RTI burdens.

"It became apparent very early on that carrying the old P35 questions over into a system that was based on real time reporting rather than  an annual cycle with a year end  was illogical and unnecessarily burdensome. HMRC agreed to drop the questions from next year and I think that is eminently sensible," he said.

Adding a point about agents not being copied into penalty notices, he said that the fastest and most effective method of appealing is likely to be the online Penalties and Appeals Service.

Aplin also said that what's still missing from RTI is a facility for providing HMRC's employer helpline with the employer and their agent's same, real-time view of RTI liabilities and payments.

"It is bizarre that everyone gets a different view and that the information an employer can view is not updated real time. If everyone could see the same thing there would be far fewer disputed liabilities and consequently less wasted time for employers and agents and fewer calls to HMRC’s employer helpline.

"Everyone would be in a better place. This should have been designed in from day one and I cannot understand why it wasn’t and why the omission has still not been remedied," he said.

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Replies (4)

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By malcolmhUK
21st Dec 2014 13:44

RTI penalties

I assume this also applies to the online penalty notices.

What possible reason can HMRC give for not informing agents other than they wish to frighten employers into paying the penalty or hoping they will take too long to refer the matter and go out of time ?

So much for keeping agents informed !

 

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By Charlie Carne
21st Dec 2014 14:27

Typically myopic view from HMRC
How do we help our clients comply with their tortuous administrative burdens when HMRC keep us in the dark about penalties that they impose. HMRC staff live in another world from the rest of us!

The best solution would be for HMRC to send electronic notices to whoever submits the RTI information via the same tool used to make that submission (eg third party, commercial payroll software). So, for example, as I submit the FPS on behalf of my client, my payroll software should collect any notices from HMRC relevant to that client and I will immediately be made aware of penalties and other notifications from HMRC. My software will also then be able to update any tax code changes automatically. This would save time and avoid errors. Wishful thinking? Hey, it's Christmas and I can dream!

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By DMGbus
22nd Dec 2014 08:29

Like account statements

This latest development is rather like the lack of access to the online PAYE account information for payroll agents.

Depriving authorised agents information that is potentially essential to carry out their duties on behalf of clients.

 

Presumably one or more of the following apply:

HMRC management are out of touch with what their staff or IT contractors are doingHMRC management have not got a clue about how the real world works in terms of what payroll agents need to knowHMRC staff or HMRC's IT contractors who might be making decisions are fresh-faced individuals straight from college always on their iPads and lacking practical experience and not understanding how payroll agents workThere might be an underlying concept within HMRC "every which way we can" make life difficult for taxpayers and their agentsThe principle of "every which way we can" might apply in an unwritten policy amongst a few within HMRC of extracting unlawful penalties from employers - deprive their agents of the knowledge of the penalties and "with a bit of luck" some gullible employers will pay the penalties without question

 

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Euan's picture
By Euan MacLennan
22nd Dec 2014 09:49

It wasn't broke ...

... so why "fix" it?

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