HMRC notes in the August 2017 issue of its Employer Bulletin that it has reviewed the use of the risk-based approach to PAYE penalties for late filing and has decided to continue the same approach in the tax year from 6 April 2017. Late filing penalties will therefore continue to be reviewed on a risk-assessed basis and will not be issued automatically.
HMRC intends to impose the first penalties for the year commencing 6 April 2017 in September. The risk-based approach involves not charging penalties if Full Payment Submissions (FPSs) are filed late but within 3 days of the payment date, unless there is a pattern of persistent late filing. Employers must still file their submissions by each due payment date except in specified circumstances. Employers persistently filing after the statutory filing date but within three days may be contacted by HMRC and could be considered for a penalty.
In the case of late payment HMRC will also charge penalties on a risk-assessment basis and persistent late payers will be the main focus. The risk-based approach to PAYE penalties will continue to be reviewed beyond 5 April 2018 with a view to focusing on the employers who persistently fail to meet the due date for payment.
