The cause of the upset for employers last year was that HMRC did not advise that the P35's were actually late until September. At this point the penalty for the smaller employers had added up to £400, significantly more for larger employers. This was deemed unacceptable by employers particularly because with computer systems at HMRC now being fully computerised the penalties were known by the 20th May.
Of course, it is an employers duty to file a return on time but there are many reasons why a return may be filed late or omitted altogether that are not deliberate.
Thankfully, HMRC have changed their process for the notifications over 2011/12 returns and have agreed the following process
- 28th April - Employer Annual Return reminder
- 31 May - HMRC will issue a "P35 Interim Penalty Letter" stating that a penalty has been triggered and what to do about avoiding the penalty increasing
Other changes being made include
- Improving the online guidance for filing of returns
- Employer helpline to advise new employers about filing deadlines
- Going forward the information on the P35 itself will be improved