SCHEDULES
C3C7C8C2C5C6C10C1C4C9SCHEDULE 56Penalty for failure to make payments on time
Sch. 56 applied (with modifications) by SI 2009/470 reg. 68(3) (as substituted (with application in accordance with reg. 1(2) of the amending S.I.) by The Education (Student Loans) (Repayment) (Amendment) Regulations 2010 (S.I. 2010/661), regs. 1(1), 6)
Sch. 56 applied (with modifications) by SI 2001/1004 reg. 67B (as inserted (with application in accordance with reg. 1(3) of the amending S.I.) by The Social Security (Contributions) (Amendment No. 4) Regulations 2010 (S.I. 2010/721), regs. 1(2), 3)
Sch. 56 applied (with modifications) by SI 2001/1004 reg. 67A (as inserted (with application in accordance with reg. 1(3) of the amending S.I.) by The Social Security (Contributions) (Amendment No. 4) Regulations 2010 (S.I. 2010/721), regs. 1(2), 3)
Sch. 56 modified (8.4.2010) by Finance Act 2010 (c. 13), Sch. 1 para. 39
Sch. 56 applied by SR 2009/128, reg. 31 (as substituted (6.4.2011) by The Education (Student Loans) (Repayment) (Amendment) Regulations (Northern Ireland) 2011 (S.R. 2011/137), regs. 1(1), 6 (with reg. 12))
Sch. 56 applied by S.I. 2009/470 reg. 36 (as substituted (6.4.2011) by The Education (Student Loans) (Repayment) (Amendment) Regulations 2011 (S.I. 2011/784), regs. 1(1), 7 (with reg. 12(1)))
Sch. 56 applied (E.) (with application in accordance with reg. 1 of the amending S.I.) by The Education (Postgraduate Masters Degree Loans) Regulations 2016 (S.I. 2016/606), regs. 1(1), 85(3)
Sch. 56 applied (E.) (with application in accordance with reg. 1 of the amending S.I.) by The Education (Postgraduate Masters Degree Loans) Regulations 2016 (S.I. 2016/606), regs. 1(1), 46
Sch. 56: power to amend conferred (22.7.2020) by Finance Act 2020 (c. 14), Sch. 7 para. 5(1)(c)
Amount of penalty: PAYE and CIS amounts F4etc.
Word in Sch. 56 para. 5 cross-heading inserted (15.9.2016) by Finance Act 2016 (c. 24), s. 113(15) (with s. 117)
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1
Paragraphs 6 to 8 apply in the case of a payment of tax falling within item 2F3, 4 or 4A in the Table.
2
But those paragraphs do not apply in the case of a payment mentioned in paragraph 3(1)(b)F6, (c) or (ca).
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F91
P is liable to a penalty under this paragraph, in relation to each tax, each time that P makes a default in relation to a tax year.
2
For the purposes of this paragraph, P makes a default F13in relation to a tax year when P fails to make one of the following payments (or to pay an amount comprising two or more of those payments) in full on or before the date on which it becomes due and payable—
a
a payment under PAYE regulations F2of tax payable in relation to the tax year;
b
a payment of earnings-related contributions within the meaning of the Social Security (Contributions) Regulations 2001 ( S.I. 2001/1004) F14payable in relation to the tax year;
F1ba
a payment under regulations under section 105 of FA 2016 of an amount in respect of apprenticeship levy payable in relation to the tax year;
c
a payment due under the Income Tax (Construction Industry Scheme) Regulations 2005 ( S.I. 2005/2045) F12payable in relation to the tax year ;
d
a repayment in respect of a student loan due under the Education (Student Loans) (Repayments) Regulations 2009 ( S.I. 2009/470) or the Education (Student Loans) (Repayments) Regulations (Northern Ireland) 2000 (S.R. 2000 No. 121) F11and due for the tax year .
F53
But where a failure to make one of those payments (or to pay an amount comprising two or more of those payments) would, apart from this sub-paragraph, constitute the first default in relation to a tax year, that failure does not count as a default in relation to that year for the purposes of a penalty under this paragraph.
4
The amount of the penalty for a default made in relation to a tax year is determined by reference to—
a
the amount of the tax comprised in the default, and
b
the number of previous defaults that P has made in relation to the same tax year.
5
If the default is P's 1st, 2nd or 3rd default in relation to the tax year, P is liable, at the time of the default, to a penalty of 1% of the amount of tax comprised in the default.
6
If the default is P's 4th, 5th or 6th default in relation to the tax year, P is liable, at the time of the default, to a penalty of 2% of the amount of tax comprised in the default.
7
If the default is P's 7th, 8th or 9th default in relation to the tax year, P is liable, at the time of the default, to a penalty of 3% of the amount of tax comprised in the default.
7A
If the default is P's 10th or subsequent default in relation to the tax year, P is liable, at the time of the default, to a penalty of 4% of the amount of tax comprised in the default.
8
For the purposes of this paragraph—
a
the amount of a tax comprised in a default is the amount of that tax comprised in the payment which P fails to make;
F10b
a previous default counts for the purposes of sub-paragraphs (5) to (7A) even if it is remedied before the time of the default giving rise to the penalty.
F78A
Regulations made by the Commissioners for Her Majesty's Revenue and Customs may specify—
a
circumstances in which, for the purposes of sub-paragraph (2), a payment of less than the full amount may be treated as a payment in full;
b
circumstances in which sub-paragraph (3) is not to apply.
8B
Regulations under sub-paragraph (8A) may—
a
make different provision for different cases, and
b
include incidental, consequential and supplementary provision.
9
The Treasury may by order made by statutory instrument make such amendments to sub-paragraph (2) as they think fit in consequence of any amendment, revocation or re-enactment of the regulations mentioned in that sub-paragraph.
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If any amount of the tax is unpaid after the end of the period of 6 months beginning with the penalty date, P is liable to a penalty of 5% of that amount.
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If any amount of the tax is unpaid after the end of the period of 12 months beginning with the penalty date, P is liable to a penalty of 5% of that amount.
Sch. 56 applied (with modifications) by SR 2009/128, reg 63(3) (as substituted (with effect in accordance with reg. 2 of the amending Rule) by The Education (Student Loans) (Repayment) (Amendment) Regulations (Northern Ireland) 2010 (S.R. 2010/91), regs. 1, 7(1))