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PAYE penalty

PAYE penalty

My client has recently received a notice of a £400 penalty for non-submission of his 2009/10 PAYE return.  It is believed that an attempt was made to submit this online before the due date (19 May) but it seems that this failed.  This is only part of the issue and on the assumption that the return has not been received by HMRC is it being re-submitted immediately.

The fine is stated to be £100 for each month or part month the return is late.   Even if the return did not get sent in on time, is it totally fair that HMRC should wait 4 months before notifying my client of his error?   I seem to recall that many other penalty notices/reminders are issued regularly.   Why could my client have not received the penalty notice after one month, thereby saving himself £300 and enabling him to correct the error immediately?

Is the delay in notfying a penalty situation yet another money-making exercise by HMRC?   Any views on the legal/moral position of HMRC?


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11th Oct 2010 11:02

PAYE penalties

This has been happening for years.  The penalties always reach this level before being issued.  In the past I have always appealed against the fact that they had the knowledge early enough to issue a penalty at the £100 stage and, if I agreed that a penalty was due, I have always sent a £100 cheque form the client along with the letter.  This has always been accepted.  Even if I don't agree with the need for a penalty I still always have a dig at their tardiness in issuing the penalty earlier in the year and try my best to get it reduced to £100.

I agree it seems to be a money making exercies and we shouldn't let them vget away with it.

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11th Oct 2010 12:01

Me too!

A client received one of these penalties in the post this weekend.  The return was submitted on line on the 18th May and I even received the gateway receipt confirming it was successful. 

I've written to the HMRC querying the penalty in the hope that it's removed.

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11th Oct 2010 14:02

See your £400 and raise you £800

Today our client received a £1,200 penalty notice for 2007-08.

This was for a duplicated scheme which HMRC said they would close in Jan 2008 after we dealt with the penalties for 2006-07!

No notices from May 2008 to Oct 2010.

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By cfield
18th Oct 2010 10:56

Me Three!

Like Dawn above, a client of mine received a £400 penalty for PAYE returns that were filed on time. We had the e-mail acknowledgement on 9 May and the on-line PAYE record also confirms they were submitted that day. I have asked them to pay £100 compensation to my client for my additional fees dealing with this. If everyone did that maybe they would stop this shameful money-raking exercise every year. HMRC clearly know that a high proportion of these penalties are wrong but obviously they are happy to keep doing it as some people are bound to pay them anyway. I have told my client he can also claim for any "distress" caused. I believe that is the magic word you have to use.


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By 0098087
18th Oct 2010 14:06


We've just had a £400 fine for 06/07. We've got the paperwork to prove it was filed on time. 

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18th Oct 2010 16:48

Ha ha, that's nothing...

One of my company clients got a £400 fine for non-submission of form  P35 for 2009/10 and it was only incorporated on 28 July 2010!!

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26th Oct 2010 13:56

I’ve got a similar case

Client handles own PAYE and attempted to file online. The typed info into website, but initial filing was rejected. Client made correction and attempted to re-efile. It wasn’t rejected so client assumed all was ok. Client only deals with this one PAYE scheme so lack of familiarity meant client didn’t realise should have had a page confirming receipt and email too. Client very ill and having some difficulty doing anything. I sympathise with client and feel this is a weakness in HMRC’s systems – HMRC’s online services knew that client had compiled P35 etc and had made one unsuccessful attempt, so I feel HMRC should be far more proactive and check for cases where figures have been entered but final submission has not been done and contact filers – HMRC shouldn’t leave it for four months.

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