PAYE RTI News
No RTI penalty charges for a year
November 15, 2012
HMRC has indicated that it will not enforce penalty charges for the failure to report RTI in its first year of operation according to Payroll World.
The leading UK payroll professional website ran an exclusive news story yesterday following an interview with Ruth Homer, HMRC’s Director General of personal tax, with overall responsibility for RTI.
Payroll World, quoted Ruth Owen as saying: “We are minded towards the soft landing approach so giving people perhaps a year to run RTI before we move into the new penalty regime. Bearing in mind that with the migration some bigger organisations aren’t coming onto RTI until next summer then we believe everybody deserves a bit of a default period before we start heading into penalties.”
“I believe that most businesses will comply and want to comply and our most important thing is let’s get the tax in and let’s get RTI up and running as opposed to creating work for everybody, which is penalties – we’d rather have the money than the penalties.”
This would mean that HMRC have decided to adopt a “soft landing” approach to enforcing RTI compliance has been advocated by a number of leading accountancy bodies including the Chartered Institute of Taxation.
PayeRti.org understands that HMRC will issue penalty notices from April 2013 to employers notifying them that they have failed to comply with their obligation to report RTI, but will not enforce payment of the penalty charge amount stipulated on the notice. HMRC will shortly announce details of its penalty charges for RTI following consultation.
HMRC’s intention appears to be to use the automated issue of penalty notices to alert employers of their obligations without actually penalising them with the payment of a charge, for an initial period.