Amount of penalty: real time information for PAYE

6B

Paragraphs 6C and 6D apply in the case of a return falling within item 4 in the Table.

6C

1

If P fails during a tax month to make a return on or before the filing date, P is liable to a penalty under this paragraph in respect of that month.

2

But this is subject to sub-paragraphs (3) and (4).

3

P is not liable to a penalty under this paragraph in respect of a tax month as a result of any failure to make a return on or before the filing date which occurs during the initial period.

4

P is not liable to a penalty under this paragraph in respect of a tax month falling in a tax year if the month is the first tax month in that tax year during which P fails to make a return on or before the filing date (disregarding for this purpose any failure which occurs during the initial period).

5

In sub-paragraphs (3) and (4) “the initial period” means the period which—

a

begins with the day in the first tax year on which P is first required to make a return, and

b

is of such duration as is specified in regulations made by the Commissioners,

and for this purpose “the first tax year” means the first tax year in which P is required to make returns.

6

P may be liable under this paragraph to no more than one penalty in respect of each tax month.

7

The penalty under this paragraph is to be calculated in accordance with regulations made by the Commissioners.

8

Regulations under sub-paragraph (7) may provide for a penalty under this paragraph in respect of a tax month to be calculated by reference to either or both of the following matters—

a

the number of persons employed by P, or treated as employed by P for the purposes of PAYE regulations;

b

the number of previous penalties incurred by P under this paragraph in the same tax year.

9

The Commissioners may by regulations disapply sub-paragraph (3) or (4) in such circumstances as are specified in the regulations.

10

If P has elected under PAYE regulations to be treated as different employers in relation to different groups of employees, this paragraph applies to P as if—

a

in respect of each group P were a different person, and

b

each group constituted all of P's employees.

11

Regulations made by the Commissioners under this paragraph may—

a

make different provision for different cases, and

b

include incidental, consequential and supplementary provision.

6D

1

P may be liable to one or more penalties under this paragraph in respect of extended failures.

2

In this paragraph an “extended failure” means a failure to make a return on or before the filing date which continues after the end of the period of 3 months beginning with the day after the filing date.

3

P is liable to a penalty or penalties under this paragraph if (and only if)—

a

HMRC decide at any time that such a penalty or penalties should be payable in accordance with sub-paragraph (4) or (6), and

b

HMRC give notice to P specifying the date from which the penalty, or each penalty, is payable.

4

HMRC may decide under sub-paragraph (3)(a) that a separate penalty should be payable in respect of each unpenalised extended failure in the tax year to date.

5

In that case the amount of the penalty in respect of each failure is 5% of any liability to make payments which would have been shown in the return in question.

6

HMRC may decide under sub-paragraph (3)(a) that a single penalty should be payable in respect of all the unpenalised extended failures in the tax year to date.

7

In that case the amount of the penalty in respect of those failures is 5% of the sum of the liabilities to make payments which would have been shown in each of the returns in question.

8

For the purposes of this paragraph, an extended failure is unpenalised if a penalty has not already been imposed in respect of it under this paragraph (whether in accordance with sub-paragraph (4) or (6)).

9

The date specified in the notice under sub-paragraph (3)(b) in relation to a penalty—

a

may be earlier than the date on which the notice is given, but

b

may not be earlier than the end of the period mentioned in sub-paragraph (2) in relation to the relevant extended failure.

10

In sub-paragraph (9)(b) “the relevant extended failure” means—

a

the extended failure in respect of which the penalty is payable, or

b

if the penalty is payable in respect of more than one extended failure (in accordance with sub-paragraph (6)), the extended failure with the latest filing date.