April sees the introduction of a new set of penalties for the late payment of PAYE, NI, CIS deductions and student loan payments. Up until now it has been quite easy and quite common for employers to delay payment or indeed underpay their monthly PAYE liabilities. After all who was to know and what were the consequences.
However, from 6 April this situation has ended. HMRC will be raising penalty notices of between 1 and 5%. This penalty depends on the number of times you are actually late and the amount that is overdue. The first late payment in the year is ignored. HMRC will not be sending out penalty notices for tax year 2010-11 until April 2011 though. Don't assume that because you haven't heard anything you have avoided any penalty.
Practically, this means that you could go for a whole year and be unaware that you have attracted a penalty.
Our advice is that the delaying or non payment of the PAYE as it falls due will be false economy this year as penalties can soon add up to sizeable sums. If you are one of our BACS customers then we can make your PAYE payments for you, automatically, on time, for the right amount and at no additional cost. If you would like to find out more please contact any of our payroll team.
You can find out more about the new penalty regime on HMRC's website.