HMRC had the power to impose penalties under the old reporting regime (P14, P35, etc) and this has continued under Real Time Information (RTI). Possibly owing to a recognition that RTI took a while to get up to speed in all areas (see Employer Bulletin June 2015, item 2), HMRC, at least at first, relaxed its stance somewhat, certainly with regards to the automatic imposition of RTI-related penalties.

Nevertheless, despite HMRC stating that it does not want to charge penalties and that it will issue electronic alerts to help employers meet their filing and payment obligations, penalties will be issued on a risk-assessed basis. This means that rather than issuing RTI penalties on an automated basis, the potential for penalties will be assessed individually, based on the employer’s overall compliance record. The risk-based approach was confirmed as still current in the HMRC Employer Bulletin: June 2022.

Penalties may be issued for late filing, late payment and / or filing incorrect returns.