HMRC has been issuing inaccurate late filing P35 penalties

A northwest accountancy firm is warning SMEs that HMRC has issued a lot of inaccurate fines over the last few months.

Mitchell Charlesworth accountants made the warning after Hok Limited had its late filing penalty reduced from £400 to £100. The company had failed to file its annual P35 form on time, but HMRC failed to send the penalty notice out until four months after the deadline.

Some commentators have suggested that this is a deliberate ploy on HMRC’s behalf, simply to raise more revenue.

Joanne Nieman, the manager in charge of payroll at Mitchell Charlesworth, said a lot of firms have received similar penalties in the last month and she urged any company that is concerned about late filing penalties to get in touch with a payroll specialist as soon as possible.

She went on to explain that it is ludicrous for HMRC to wait for so long before sending out penalty notices. If they were sent out in a timely manner, many firms would have rectified the situation. As it is, several firms have now approached a tribunal and have had their fines waived.

Mrs Nieman went on say that the current penalty notice system is flawed and HMRC has been criticised by first tier tax tribunal judges for not issuing the notices earlier. The accountancy firm said that some clients had received non-submission penalties even though they used HMRC’s website to submit ‘nil returns’.

A recent HMRC investigation did reveal a mistake in the processing of ‘no return to make’ P35 notifications which led to some companies receiving a penalty notice in error.

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