Has your business received a statement from HMRC with a ridiculously high amount of PAYE tax and national insurance due? If this is the case and you know for a fact the amount is not outstanding, look closely at the wording of the statement, does it say Specified Charges?
What is a Specified Charge?
A Specified Charge is an estimate of PAYE outstanding based on previous PAYE payment and filing history.
If your business doesn’t tell HMRC that it hasn’t paid any employees or directors in the tax month by sending an Employer Payment Summary (EPS), or if your business has paid employees or directors and doesn’t submit a Full Payment Summary (FPS) on time HMRC may raise a Specified Charge.
How to avoid a Specified Charge
Make sure your payroll is RTI compliant. If a submission appears to not be filed by the due date for either an FPS or an EPS a late filing penalty could be imposed and a Specified Charge will be raised.
The filing penalties could potentially get quite costly if your business doesn’t get RTI right;
Proposed filing fines for 2014/15
The amount of the fine depends on the number of employees your business employs.
• Employers with 1 to 9 employees the penalty will be £100 per month
• Employers with 10 to 49 employees the penalty will be £200 per month
• Employers with 50 to 249 employees the penalty will be £300 per month
• Employers with 250 or more the penalty will be £400 per month