Client received RTI late filing penalities

Client received RTI penalities

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I foolishly forgot that penalities for micro companies were being applied from April 2016

My client was running the weekly payroll (for two employees) and incurred around £200 in fine for late filing in May and June

I have been running the weekly payroll since July and unfortunateky I have been more than three days late on a couple of payrolls.  I now send myself a reminder every week to file the weekly payroll.  I am sure HMRC will send a penalty soon.  These penalities are harsh especially for those employers that run weekly payrolls.   I can understand if penalities were levied if we had missed filing weekly payroll say one month but the penalty regime seems harsh on smaller companies who can easily miss a weekly payroll submission

I know you can appeal on online for the penalities but wondered if anyone had any success or tips to ensure these penalities are waived.

 

 

 

 

Replies (14)

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Euan's picture
By Euan MacLennan
30th Sep 2016 09:44

Firstly, you don't get a penalty for the first tax month in which there is a late (weekly) submission, so that probably explains why there was no penalty for April.

Secondly, the penalty is only £100 a month however many (weekly) submissions were late during the tax month.

Clearly, this weekly payroll is habitually filed late. I would suggest converting to a monthly payroll (you can give the employees a loan of 3 weeks net pay in the first week of the month and claw it back over the next (say) 3 months. Failing that, do you realise that the only date which HMRC knows is the paydate you tell them in the FPS. You might like to tell the employees that the contractual payday has changed from (say) Saturday to (say) Tuesday and date the payroll accordingly

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Replying to Euan MacLennan:
RLI
By lionofludesch
30th Sep 2016 10:35

True enough about the one penalty a month but you still get 4.333 times as many chances to trigger it.

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Replying to Euan MacLennan:
JC
By A_non
04th Oct 2016 07:49

Euan, how will this loan business work?cant get my head round it. We use MoneySoft. Say as an example, Net weekly of an employee is £300. Do we just pay £1200 (300 X 4 wks) in October Payroll, and then claw it back over the 4 months. This ultimately means another loan month after, and month after...how will it work??

Sorry for being thick..

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Replying to A_non:
Euan's picture
By Euan MacLennan
04th Oct 2016 10:27

You pay the employee £1,200 by cheque (or whatever) at the beginning of October and get him to sign a letter to confirm that it is a loan to be repaid by deduction from payroll over the next 4 months.

On Moneysoft, you enter £1,200 as the Amount Advanced in October on the Subs tab of Pay Details and £300 as the Amount Repaid in October, then copy it down for the next 3 months. You will note that the third column, Balance owed to Employer, shows the reducing balance.

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By NYB
30th Sep 2016 20:36

Fail to see how you can consistently fail to file weekly. You must KNOW it is due. It's a pain I agree & certainly monthly should be considered. If you were my payroll person I would be annoyed I am paying you to do a job in which you are failing.

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Routemaster image
By tom123
30th Sep 2016 21:15

Jim, are all these payrolls below the limits for tax & NI? If not, then how are you preparing the payslips and then not filing?

Just curious?

I must admit, when I migrated a whole factory of 200 staff from weekly to monthly pay it took a great deal of hassle out of life..

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Replying to tom123:
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By Jim100
01st Oct 2016 17:41

tom123 wrote:

Jim, are all these payrolls below the limits for tax & NI? If not, then how are you preparing the payslips and then not filing?

Just curious?

I must admit, when I migrated a whole factory of 200 staff from weekly to monthly pay it took a great deal of hassle out of life..

The amounts are the same each month

I was thinking can I file say one filing 4 weekly payrolls in advance each time. These two employees have been with the company for years and they do not intend to hire any more employees.

I will be appealing against the penalties and just wondered if HMRC are still lenient or strict in rejecting penalty appeals on RTI.

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Replying to Jim100:
Routemaster image
By tom123
01st Oct 2016 18:53

Has the subject of moving to monthly been brought up - I'm guessing you are not staging for Autoenrolment yet.

Could be a good subject to hang the discussion on to

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Replying to tom123:
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By Jim100
01st Oct 2016 21:13

All the employees earn less than 10K so no enrolment as yet. I think the staging date is next year.

They want to pay the employees weekly instead of monthly though I suppose they could run the monthly payroll and give pay them on a weekly basis.

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Replying to Jim100:
Euan's picture
By Euan MacLennan
03rd Oct 2016 09:58

Jim100 wrote:

They want to pay the employees weekly instead of monthly though I suppose they could run the monthly payroll and give pay them on a weekly basis.

Are you suggesting running the monthly payroll at the end of the month and giving them "advances" in the previous weeks? That would not work as advances of earnings are payments that must be reported under RTI on or before the date of payment.

Or, perhaps, you mean run the monthly payroll at the beginning of the month and spread the payments over the following weeks?

If you insist on running a weekly payroll, your best bet is your earlier suggestion that having made sure that you file the first week on or before the date of payment, you then, at the same time, file the following weeks in advance.

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Replying to Jim100:
Euan's picture
By Euan MacLennan
03rd Oct 2016 10:01

Jim100 wrote:

I will be appealing against the penalties and just wondered if HMRC are still lenient or strict in rejecting penalty appeals on RTI.

On what grounds would you appeal? That the amount of fines is disproportionate to the amount of PAYE involved? It seems that you are a serial offender, so I doubt that HMRC will be lenient.

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By brightsparke12
03rd Oct 2016 19:32

I have a client who has filed late (does homself) because he misunderstood the difference between the date the hours were up to and the date of payment - he thought they had to be one and the same, rather than the date of payment. I am now taking over the payroll, and am planning to appeal - does anyone have any experience of appeals being successful??

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tax
By AFABS
04th Oct 2016 11:35

I can understand the FPS not being run at the same time as the wages as you may wish employees to check their payslips before you inform the HMRC.

I was told of a crease, which I’m yet to try. Try changing the system date on your PC before sending the FPS. It stops the first stage of interrogation but whether it stops a fine – I do not know.

Don’t forget to change the date back again!

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By TDRtax
04th Oct 2016 20:20

For crying out loud. The employees are not your clients, the employer is. You run the payroll, the employer approves, and you RTI. Job done.

Why are so many people (including professionals) having so much trouble with this?

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