Quarterly News

Penalty delay criticised

In a potentially wide ranging case, HMRC have been criticised for deliberately issuing penalties for late forms P35 and P14 (Payroll end of year forms) several months late, which resulted in more penalties than were necessary.

In the case concerned an appeal was made against a penalty of £400 for late filing of the 2009/10 P35 which was required by 19 May 2010. The penalty was calculated at £100 per month for four months. Once the company had been alerted to its default, it took action and filed the return on 15 October 2010. However, this was too late to avoid the issue of a further penalty of £100.

The company argued that it thought it did not need to file the appropriate returns because its only employee had ceased employment part way through the year. It acknowledged that it was wrong and that HMRC was entitled to levy a penalty. However, the company argued that, if HMRC had promptly notified it of its default, it would have been remedied at a far earlier time, thus avoiding ongoing penalties.

The Tribunal found in favour of the company and their report states:

As a result the penalty was reduced to £100. This case may also apply to other employers who have received penalty notifications in similar circumstances. Please contact us if you think this may be relevant.

In the last edition

Winter 2011 headlines

• HMRC get tough
• Allowances alert
• All aboard for VAT online
• Penalty delay criticised

We provide four Quarterly News Journals packed with useful breaking news, all intended to keep you up to date with the latest information. We display one years worth of news, just in case you have missed something.

• back |
• top