A4.554 Late filing penalties—real time information for PAYE and apprenticeship levy
All employers operating Pay As You Earn (PAYE) are required1 to make returns under real time information (RTI) (see E4.1104) to provide HMRC with pay and deduction details each time they pay their employees.
With effect from 2014/15, a separate penalty regime applies to RTI returns which are not made on time2. This also applies to returns in connection with the apprenticeship levy from 6 April 2017.
Penalties apply to each PAYE scheme, with the size of the penalty based on the number of employees in the scheme, so that different-sized penalties apply to micro, small, medium and large employers. Filing defaults apply for each month that a return is not received. The first default in any year is not penalised, but all subsequent defaults attract a penalty.
Penalties are charged quarterly, and are subject to the reasonable excuse and appeal provisions (see A4.568, A4.596). An additional tax-geared penalty applies where a return is outstanding for three months or more.
Application of penalty provisions
Penalties apply3 to RTI employers (those who have at least 50 employees on 6 October 2014) from 6 October 2014 and to small RTI employers (those who at 6 October 2014 have