PAYE & CIS Penalties
7th Jan 2010
New Penalty Regime Explained
A new penalty regime is being introduced on 6th April 2010.
You may have to pay a penalty if you do not pay the PAYE or CIS tax due each month, on time and in full.
The penalties are a percentage of the amount you pay late. They start at 1% and increase to 4%. There are also penalties of 5% if PAYE or CIS tax is unpaid after six and twelve months.
A table summarising the penalties due is set out below.
How do you avoid penalties?
Pay the correct amounts, on time! However, if you are unable to pay it is essential that we make a “payment arrangement” with HM Revenue & Customs, if you wish to avoid penalties. This involves talking to HM Revenue & Customs before the tax is due for payment.
What if nothing is due?
You should inform HM Revenue & Customs either by completing a nil payslip, or online, or on the telephone.
PAYE and CIS penalties – from 6th April 2010
Default |
Penalty |
|
|
|
|
First default
|
Nil
|
|
Second, Third
|
1% of total
|
|
Fourth, Fifth, Sixth
|
2% of total
|
|
Seventh, Eighth, Ninth
|
3% of total
|
|
Tenth, Eleventh, Twelfth
|
4% of total
|
|
|
|
Plus |
|
|
|
|
|
Tax unpaid after six months
|
5%
|
|
Tax unpaid after twelve months
|
5%
|
Author: Emma Glover (emma.glover@rowlandsaccountants.co.uk)
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