Tax Partner
Smith Kiew Partnership
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2013/14 P35 penalty

2013/14 P35 penalty

My last employee ceased on 30 November 2009. Form P45 was submitted at that time. I submitted a P35 for 2009/10 and 2010/11, the later one with nil entries. I wrote to HMRC in May 2011 requesting the closure of the PAYE scheme. No response was ever received but I assumed it was a straightforward situation and did not chase up. I did not submit a P35 for 2011/12 and HMRC did not chase for one.

I then ceased trading on 30 November 2011. For 2012/13 a P35 request was issued. I spoke to HMRC and they advised they would note their records of the cessation of trading and the closure of the scheme but the officer I spoke to said it was best to submit the P35 for 2012/13 anyway and tick the box where it asks if trading has ceased which I did.

Out of the blue I have just had a letter from HMRC Debt Management and Banking stating that there is PAYE Tax and NIC of £2,400 plus interest due for the 2013/14 tax year. This is the first letter I have received on the issue, although I have moved twice since November 2011.

How best should I reply - letter to DM office and the PAYE office stating I ceased trading in 2011/12? Any advice would be greatly appreciated.


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09th Jun 2014 09:27

I would

Tell them the facts as they are and then tell them to sort out their system and errors and cancel ALL penalties.  From what you say you have not done anything wrong and this is entirely their error.

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By stratty
09th Jun 2014 10:07

P35 Penalty

Are you sure it is a P35 penalty?  Sounds like a specified charged under RTI to me.

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09th Jun 2014 10:16


stratty wrote:

Are you sure it is a P35 penalty?  Sounds like a specified charged under RTI to me.

Technically correct - not sure it's important though.

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By adambl
09th Jun 2014 10:17

RTI it is


Looking at it yes it is referring to a "PAYE Specified Charge".

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09th Jun 2014 10:52

Call them

I had one last week.

Our client had got himself a PAYE job back in 2011/12. For 2012/13 we sent the online notification that no P35 needed to be filed. For 2013/14 we did nothing and therein lay the problem. I called HMRC and they were happy to cancel the assessment.

They need you to comply with RTI reporting requirements or close the PAYE scheme to prevent you being bothered again.

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09th Jun 2014 15:47

Another RTI botch

I've also had one of these, a debt recovery action by HMRC demanding £2400 plus interest on the 2013-2014 year for a client company which never registered for RTI since it was dormant, and which eventually became delisted at Companies House in December 2013. No idea what the penalty was about, since neither the client nor myself ever received anything apart from this "final" Debt Management demand. I've just written to HMRC telling 'em to get lost (well, being a coward, I didn't use exactly those words).

As an aside, I've just emailed to HMRC my last RTI back-up file (they asked for it), along with my RTI log, so that they can try and discover why I am still being sent dozens of RTI generic non-filing notices ... the helpline people were very helpful, couldn't understand why I should be being sent these generic non-filing notices for all my PAYE clients. And with regards the alarm screen on opening Basic PAYE Tools that I must do X, otherwise all my submissions would fail, they could also see that the offending PAYE schemes had been closed, so obviously I can't do X ... but, interestingly they also said that this alarm message shouldn't have any knock-on effects on my other clients' RTI submissions ... be interesting to see what they come up with. I'm blowed if I know the answer. And yes, that took most of the morning on the phone to three different agent RTI helplines. And today I've just had another rash of RTI generic non-filing notices for all my clients. HELP!

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