PAYE Late Payment Penalties

A new penalty regime was introduced with effect from 6 April 2010 and late payment penalties will now apply to monthly, quarterly or annual PAYE payments. It will include all income tax and national insurance contributions due under PAYE, the Construction Industry Scheme and student loan deductions.

There will also be late payment penalties for not paying amounts due annually on time and in full, including Class 1A National Insurance Contributions due on forms P11d and Class 1B National Insurance Contributions due on PAYE settlement agreements.

The amount of the penalty will be calculated on a sliding scale of percentages ranging from 1% to 4% and be dependent on the number of times the employer has been late making payments during the past tax year. The new penalties apply to all employers and CIS contractors, regardless of the size of the business or normal frequency of payment.

If you are concerned about the possibility of a penalty please contact your local TaxAssist accountant for more information.

Date published 5 Dec 2012

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.