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HMRC internal manual

Compliance Handbook

Penalties for Failure to Pay on Time: Rules for specific taxes: Bank Payroll Tax (BPT): Penalties: Failure to pay all or part of amounts due - overview

If a person fails to make a full payment of BPT by the due date, they become liable to a penalty on the amount unpaid.

The penalties for failing to pay BPT in full and on time are

  • an initial penalty of 5% for tax unpaid at the penalty date, see CH153620, and
  • two further penalties of 5% each for tax unpaid at 5 and 11 months after the penalty date, see CH153640.

So a failure to pay that continues for 11 months after the penalty date can incur all of these penalties on the same unpaid tax.

It is important to distinguish between

  • the due date - the date when the person needs to pay the tax, and
  • the penalty date - which is normally the day after the due date and the first date on which a penalty is chargeable for a tax period.

There are special rules for the penalty dates relating to determinations, assessments, corrections and amendments, see CH153700.