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HMRC moves to calm RTI pilot penalty fears

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30th Apr 2013
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HMRC has provided some clarification over RTI pilot penalties and late returns after a number of AccountingWEB members set alarm bells ringing last week.

Member Kazmc raised the issue after learning from Sage that there will be penalties for late filing, despite being told there would be no penalties in the pilot other than if the 19 May deadline for year-end returns was missed.

After discovering that under RTI the deadline for submitting year-end returns was 19 April rather than 19 May under the old system, Kazmc assumed that as there would be no penalties for the first year of RTI, FPSs could be submitted late. But when they tried to subit month 12 FPSs and the end of year declarations, they had missed the 19 April deadline.

Sage advised Kazmc that the only way around this was to give HMRC a list of all the payrolls affected. Then when the EYU [Earlier Year Update] facility is available, the employer will have 14 days to submit everything via the government gateway. If this does not happen, late filing penalties will apply.

Other AccountingWEB members reported similar problems. Onicholson pointed out that if you're depending on HMRC's tools then you must contact them or you could end up with penalties because the tools won't be ready in time.

“The deadline for informing them that you'll be late because of the delay with the tools is 19 May though so you could wait until it's a little quieter to contact them,” Onicholson suggested.

Clearly very angry about the RTI penalty situation, Kazmc explained that they would now in a position where they could not submit any payroll details to HMRC for 2012/13 for nearly 100 payrolls and would now face a £100 fine for each one.

“This is a monumental cock-up and completely penalises employers for joining the pilot,” Kazmc said.

Moonbeam agreed: “you are now being penalised for being so helpful and joining their wretched pilot scheme.”

The problem has also reared its head for large numbers of employers who discovered that HMRC had placed into the RTI pilot scheme without telling them. Both 12Pay's Tom McClelland and AccountingWEB's Rebecca Benneyworth advise anyone in this situation to contact the new HMRC employer helpline on 0300 200 3211 and ask them to reset the scheme’s RTI commencement date to 6 April 2013.

Gary Ging from Sage UK offered clarification on Kazmc's situation: “HMRC have confirmed that as long as the end of year declarations are sent on an EPS by 19th May then there will be no penalty issued and there will be no need to send an EYU.”

When Kazmc pointed out that the original problem stemmed from annual payrolls that have not submitted any FPSs for 2012/13, Ging suggested contacting the employer helpline to revert back to traditional PAYE for 2012/13. That would enable the Kazmc to complete P35/P14 submissions, which must reach HMRC by 19 May to avoid a penalty.

Ging summarised:

  • If the scheme was in RTI pilot but no FPS sent at all by 19 April - scheme needs to be reverted and P35/P14 sent by 19 May
  • If the scheme was in RTI pilot and final FPS was sent by 19 April but without end of year declarations - use EPS to send declarations by 19 May
  • If the scheme was in RTI pilot and FPS's were sent during the year but the final FPS figures were incorrect - use EPS to send declarations by 19 May (if not already done so) and use EYU when available to correct the FPS figures.

However, the problem persisted after Kazmc came off the phone with HMRC, who were “absolutely adamant” that they could not pull out of the pilot as they submitted an EAS.

HMRC also offered clarification, explaining that pilot employers were expected to make submissions by 5 April. Pilot scheme employers who did not do this could meet their end of year filing obligations for 2012-13 and avoid a penalty if:

  • They sent HMRC an full payment submission (FPS) or employer payment summary (EPS) for tax year 2012-13 with the ‘Final Submission for Year’ indicator, or, the ‘Final Submission due to cessation’ indicator completed by 19 April; or
  • They send an earlier year update (EYU) for 2012-13 by 19 May.

Kazmc accepted the clarification, but pointed out they were still awaiting confirmation whether or not they can use the EYU if no FPS has been submitted at all during the 2012-13 tax year because the payrolls were annual.

“Some technicians at HMRC seem to think you can, others are of the mind that you cannot do an amendment, which is apparently what the EYU is for, if there is no original information to amend,” Kazmc said.

We await a response from HMRC on this final point.

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Replies (4)

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By Kazmc
30th Apr 2013 14:32

Have HMRC Finally Relented?

I have literally just put the phone down to HMRC and I have successfully managed to alter the migration date from 06.11.12 to 06.04.13 for 2 companies who have had an EAS submitted (but no FPS's or EPS's).

The technician I spoke with on the phone originally said I would not be able to change the migration date as an EAS had been submitted but said when he looked at the clients records it showed that no EAS had been done, even though we have a successful correlation ID to prove one was sent.

This happened with 2 client payrolls who had definitely had EAS's submitted so he came to the conclusion that HMRC must have changed their systems to allow employers to leave the pilot if an EAS had been submitted but had just not told the staff on the helpdesk!!

We are now currently compiling our list of clients to remove from the pilot which unfortunately will have to be called through in batches of 5 as that is the maximum the technicians are allowed to deal with during each phone call !

So a massive bulk of pilot payrolls are now needing to be removed from the pilot, what an absolute waste of time..........

 

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By Kazmc
01st May 2013 09:42

Have just..

Just to confirm have just had a phone call from HMRC this morning confirming that, yes, pilot employers who have only submitted an EAS during 12-13 are now allowed to alter their migration to 06.04.13 and thereby removing themselves from the pilot.

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By Robert Lovell
01st May 2013 12:09

Further clarification from HMRC

AccountingWEB receieved the following message from HMRC:

"If an employer had a start date during 2012-13 and paid employees they should have

• Submitted an FPS for 12-13 by 5th April (but we could accept the FPS up to 19th April) • If no payments made for 12-13 or in month 12 of 12-13, they should have submitted a nil EPS by 19th April  If they missed those deadlines and they paid employees in 2012-13, but did not report those earning to HMRC, the following guidelines should be followed if this is not an annual scheme. The employer should:• Submit an FPS for 2013-14 before they submit the EYU for 12-13 • Report earnings for 2012-13 on an EYU"

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By Kazmc
01st May 2013 12:22

Past the Point of Caring..........

I have, I think, reached the point of not caring anymore!

After being able to move the migration date to 06.04.13 for 3 pilot payrolls yesterday (calling the Employer Helpline) for whom an EAS had been submitted and subsequently this morning receiving a call from HMRC confirming this is now allowed and receiving a call from SAGE saying this is now fine..........

Just called to move the date for another client and after 30 minutes of being on the phone and speaking with 3 different technicians they wont change the migration date!!!!!!!!!!!!!!

I GIVE UP - What the hell are HMRC playing at, we have 2 weeks left to remove over 100 clients from the payroll (remembering you need to leave 48 hours between removing them and submitting returns) and submit old style P35s. This is on top of trying to do another 150+ old style yearends which were not in the pilot.

I am now waiting for a call from HMRC......... how ever long that will take..........

 

 

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