Home › Business news › A Reminder on PAYE Penalties

A Reminder on PAYE Penalties

23 Sep 11

Penalties will be charged on each PAYE reference number (also called a ‘PAYE scheme’) independently.  Therefore, if you operate more than one PAYE scheme you need to make sure that amounts due for each individual PAYE scheme reference is paid in full on time.  The following explains how the penalties apply for different types of payment.

Monthly or Quarterly PAYE Payments

You will not be charged a penalty if only one PAYE amount is late in a tax year – unless that payment is over six months late.  The amount of the penalty will depend on how much is late and how many times your payments are late in a tax year. So if you pay part of what is due on time then any penalty will only be charged on the part that is late.  The table shows how the penalties are calculated.

Penalty Charges for Late Monthly and Quarterly PAYE Payments

No of Times Payments are Late in a Tax Year

Penalty Percentage

Amount to Which Penalty Percentages Apply

1

No penalty (as long as the payment is less than six months late)

Total amount that is late in the tax year (ignoring the first late payment in that tax year)

2-4

1%

5-7

2%

8-10

3%

11 or more

4%

 

 Additional Penalties for Monthly and Quarterly Payments Over Six Months Late

If you have still not paid a monthly or quarterly amount in full, after six months you may have to pay a penalty of 5 per cent. A further penalty of 5 per cent may be charged if you have not paid after 12 months.  These penalties may be charged in addition to the penalties for monthly and quarterly payments described in the previous section and apply even where only one payment in the tax year is late.

To find out more contact: Stephen McConnell, Business Services Director, Email stephenmcconnell@mooneymoore.co.uk Tel: +44 (0) 28 9032 3466