PAYE on the nail
If you pay your monthly or quarterly PAYE and other payroll deductions to HMRC late (after 22nd of the month for electronic payments), you are likely to receive a penalty. This is a relatively new policy. Before 2010/11 you only had to worry about paying the total amount due for the whole tax year by 19 April after the end of the year. Now you have to aim to get every payment in on time.
HMRC will allow you just one late payment for the year, but after that the penalties start to mount up, and can reach 4% of the late paid tax. For 2010/11 and 2011/12 HMRC was slow in issuing penalty notices, but for this year HMRC has started to warn employers who haven’t paid all their PAYE on time before the tax year has finished. If you have received a warning letter about late paid PAYE, don’t ignore it.
A good way to keep an eye on your PAYE payments, and where HMRC may have allocated them, is to use the business tax dashboard facility on the HMRC website. For PAYE this should show:
- the payments of PAYE made;
- interest charged on any late payments;
- penalties charged; and
- any reallocations of monies paid.
Unfortunately we can’t directly access your business tax dashboard as your tax agent, but we can help you interpret the figures.