To date, HM Revenue & Customs (HMRC) have taken a fairly relaxed approach with the penalty regime for RTI. However, from 6 April 2014 this will change and penalties will begin to accrue after the first failure in the following circumstances:
- Filing a Full Payment Submission (FPS) after the date of payment stated in the report.
- Failure to file an Employer Payment Summary (EPS) reporting a nil payment required.
- Failure to pay Paye due in full, and on time for a particular tax month.
Penalties will be subject to a sliding scale, dependent on the number of employees on the payroll. Employers with less than 9 employees will receive a £100 fine, which will increase to £400 for employers with 250 employees or more. The first default in a tax year will not attract a penalty.
Penalties will start being imposed by HMRC at the end of the tax quarter where a penalty is due for a tax month.