HMRC are being lobbied to delay introducing the penalties for late RTI returns planned to start from April.
A survey by The Chartered Institute of Payroll Professionals shows that employers and payroll bureaux don’t believe HMRC are currently capable of getting it right.
The survey asked just two questions:
1. “do you have confidence in HMRC issuing accurate penalty notices in respect of the employer obligations for real time information from April 2014?”
72% said they didn’t have confidence in HMRC issuing accurate penalty notices
“They don’t seem to be able to issue employees with correct tax codes or apply the correct credits to employers accounts so why should we have confidence in them issuing correct penalty notices”
2. “do you think the penalty regime should be delayed?” And by how long
Nearly 80% said the penalty regime should be delayed by 12 months or more
“At least 12 month or until HMRC are able to correct their system to handle RTI submissions effectively without putting the responsibility back on the employer/accountant/bureau”
Shoddy administration by HMRC was the main reason given, with respondents telling tales of bureaucratic woe.
Most worryingly, many reported that HMRC’s figures often don’t add up: they fail to correctly reconcile the RTI report with the payments made. As a result the employer’s HMRC account shows an underpayment and so companies are being aggressively chased for non-existent debts.
Never take a penalty notice at face value. Always check your own records, and if in doubt refer to your payroll professional / accountant.
On 10 February 2014, HMRC announced that the penalty regime will be delayed until October. Great news for employers and payroll professionals alike.