February 2010

Businesses face fines over online returns

Senior Manager Ian Hales

Auker Rhodes Chartered Accountants are warning that small businesses risk fines of up to £3,000 if they fail to submit their Employer Annual Returns electronically this year.

All firms with five or more employees must file their details online by 19 May or face a penalty, calculated as a percentage of the amount paid late, with higher fines for consistently late payers.  Firms with more than 50 employees have had to file online since 2006.

Ian Hales from Auker Rhodes said “HM Revenue and Customs (HMRC) has also warned employers that anyone who submits a paper form, even if it is before the 19 May deadline, could face a penalty charge.

“In order to file online, businesses must register with HMRC’s PAYE online service at www.hmrc.gov.uk/paye.

“Businesses with fewer than five employees will be given another year to fall in line, while there is also an exception for religious groups whose beliefs are incompatible with electronic communications”.

HMRC claims submitting returns online will reduce delays and errors and is offering its own software for free to help small employers. However, business groups have criticised the department’s stance, saying some smaller firms do not have enough IT expertise to file these details online.

The author is a senior manager in Auker Rhodes Limited Chartered Accountants of Bradford, members of UK200Group with offices throughout the UK and Associates overseas. 

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