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HMRC confirms RTI Generic Notification System

September 23, 2013

 

HMRC have published information about their new Generic Notification System for RTI which launches in October in their latest Employer Bulletin. The system, known as ‘Generic Notifications’, aims to ‘help employers to get things right and to avoid incurring penalties’, according to HMRC. There are four notices which employers, or those submitting RTI returns on their behalf, will be able to view.  The notices will be available in different places depending on how the employer makes their submissions to HMRC.

The significance of generic notifications is that agents and accountants formally mandated by employers will see the messages automatically where they provide a payroll service. This is because the messages are ‘generic’ – with no specific PAYE data – and agents appointed using HMRC’s standard agent form 64-8 are authorised to receive copies of general HMRC client notifications. This development addresses what payroll experts have called the RTI ‘information gap’, where payroll providers cannot see if there are any problems on the PAYE account of the employer clients whose payroll they manage.

The notifications fall into two categories; filing notices and payment notices.  The first non-filing notice alerts the employer or agent to the fact that HMRC’s records show that the employer has failed to send one or more Full Payment Submissions that HMRC was expecting for a specific period. The notice will alert the employer to the fact that they are at risk of incurring penalties.  Similarly, the second late filing notice will be sent to an employer who appears to have submitted their FPS late in order to remind them of the importance of submitting their RTI reports on time.

The third notification, for late payment, covers instances where an employer appears not to have paid PAYE in full and on time (based on an underpayment on their PAYE account between what is showing as due and what the employer has paid). This notification will explain how employers can avoid potential penalties by ensuring payment is made promptly and all outstanding PAYE and NICs are paid in full. The notice will also tell employers what to do if no payment is due.  The fourth notification, also a payment notice, reminding employers about repeat late payments will be sent if the employer has failed to pay the full amount of PAYE due on more than one occasion.  This second payment notice also repeats the information on how the employer can avoid penalties.

The notices will be simultaneously available in different places depending on how the employer or their agent usually submits RTI returns. Most users of commercial payroll software who make their submissions over the internet via the Government Gateway will receive the notifications through their software automatically.  If the payroll software is not compatible or HMRC’s Basic PAYE Tools are used, the Notifications will be available by logging on to PAYE Online Services and selecting the notification from within the Notice summary section.  Those users who use Electronic Data Interchange (EDI) will also see the Generic Notifications through their EDI software.  Employers who use EDI or HMRC’s Basic PAYE Tools can also view notifications online.

The HMRC employer bulletin makes clear that to obtain Notifications from PAYE Online Services the employer or their agent must register for these services.  Any agent submitting returns on behalf of an employer has to be authorised to act on their behalf in order to use HMRC PAYE Online Services to access the Generic Notification Service for their client, either by filling in a form 64-8 or FBI-2 or via Online Agent Authorisation.  Generic Notifications can also be viewed from HMRC’s PAYE Desktop viewer.

Employers and agents can choose to receive an email alerting them to new notifications by choosing the ‘Notifications email’ option in PAYE Online Services, however those users who already receive email alerts for Tax Code and other existing notifications will automatically receive these new email alerts.

The advent of Generic Notifications means that significant numbers of agents will from October receive generic notification that there is a potential problem with RTI and a potential liability to penalties before their client; because generic notification messages will be received automatically by the agent via the payroll software they use to deliver their payroll service, at the same time they submit client RTI returns. This compares to the email alert service or logging on to review notifications online which require the agent to initiate the notifications.

HMRC’s introduction of Generic Notifications 6 months ahead of the commencement of their RTI penalty regime is intended to allow employers sufficient time to strengthen and improve their PAYE compliance processes so as to avoid future penalties. The introduction of Generic Notifications therefore appears indirectly to confirm HMRC’s introduction of RTI automated penalties from April 2014.

HMRC first published its plans to introduce Generic Notifications prior to the commencement of RTI reporting in April 2013. HMRC also confirmed it intends to expand the generic notification service and introduce further messages in the future, either for information purposes or to notify employers specific action needs to be taken.

 

 

The 4 initial Generic Notifications as summarised by HMRC including HMRC’s sample wordings, are:
 

A non-filing notice

This will be sent to an employer when HMRC records show that they appear not to have sent one or more of the Full Payment Submissions (FPSs) that HMRC expected for a particular period. It will explain that the employer is running the risk of incurring penalties – and what to do to avoid them:

Our records indicate that you haven’t sent one or more of the Full Payment Submissions (FPSs) we expected for the period ending 05/11/2013. You must send an FPS each time you pay your employees. From March 2014, if you don’t file your FPSs on time you may incur penalties. If you didn’t pay any employees for all or part of this period, and therefore had no or fewer FPSs to send to us, please let us know by sending an Employer Payment Summary (EPS) straightaway. In future, this will help us avoid incorrectly issuing you with a penalty because we were expecting an FPS from you. If you think this notice is incorrect please contact HMRC’s Employer Helpline.

 

A late filing notice

In a similar vein, this will be sent to an employer who appears to have submitted FPS late. It will remind employers that FPS should be sent on time – and that penalties may be charged in future if they are not:

Our records indicate that your Full Payment Submission (FPS) dated 15/11/2013 was sent late. You must send an FPS on, or before, the time you pay your employees. In future, please ensure that your FPSs are sent on time. From April 2014, you may incur penalties if you file your FPSs late. If you think this notice is incorrect please contact HMRC’s Employer Helpline.”

 

A late payment notice

This notification will be sent where an employer appears not to have made full payment on time. It will explain that in order to avoid potential penalties in future, employers should bring payments up-to-date and ensure future payments are made on time and in full. It will also explain what to do if no payments were actually due:

Our records indicate that you did not pay the full amount on time for the period ending 05/12/2013. To reduce any potential late payment penalties, please pay any amount still outstanding and ensure future payments are made on time and in full. If you didn’t pay any employees during this period, and therefore had no payment to make, please let us know by sending an Employer Payment Summary (EPS) straightaway. In future, this will help us avoid incorrectly issuing you with a penalty because we were expecting a payment from you. Employers can check their liabilities and payments through the HMRC Business Tax Dashboard.

 

A notice reminding about late payments

Where an employer does not pay in full and on time again, this will be issued as a follow-up to the above notification. It will reiterate the action required to avoid penalties for failure to pay:

Our records indicate that again, you did not pay the full amount on time for the period ending 05/04/2014. To avoid any possible enforcement action and limit any late payment penalties, please pay any amount still outstanding now and ensure future payments are made on time and in full. Please do not ignore this warning. If you didn’t pay any employees during this period, and therefore had no payment to make, please let us know by sending an Employer Payment Summary (EPS) straightaway. In future, this will help us avoid incorrectly issuing you with a penalty because we were expecting a payment from you. Employers can check their liabilities and payments through the HMRC Business Tax Dashboard.

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