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HMRC internal manual

PAYE Manual

Employer returns: electronic employer returns: receipt of an appeal

Recording receipt

On receipt of an appeal against a Regulation 210, Income Tax (Pay As You Earn) Regulation 2003 Penalty (failure to file online), you should immediately

  • Record the date the appeal was received and the appropriate appeal type (PAYE44075) in the ‘appeal’ part of the Penalty Appeal window
  • Note the ECS394(A)(efile) file copy notice of penalty determination ‘appeal’ received on (insert date)

Where the employer claims that they have filed online, you should check for the relevant transaction using the online tracking tool and establish the current state before proceeding further with the appeal.

Reasonable excuse

The following examples are a guide to, but not an exhaustive list, of circumstances, which might amount to a reasonable excuse

‘All my computerised records have been lost.’ 

  • We may agree that loss of all your records in a fire or flood, or if they are stolen, is a ‘reasonable excuse’, but we will need evidence of what happened. You will have had to have done your best - perhaps with our help - to put together the best estimates that you could make. If you could not file online despite doing your best to reconstruct your records, we would not charge the penalty

‘I have suffered from serious illness or a bereavement.’ 

  • We accept that serious illness or the death of a close relative or (domestic) partner may mean that you have to delay online filing. This is a ‘reasonable excuse’, but if you later send your return in on paper when it should have been filed online we will not regard your illness or bereavement as an excuse for not filing online

Unacceptable excuse

The following examples are a guide to, but not an exhaustive list, of circumstances, which might not amount to a reasonable excuse

‘I did not send my return online to avoid a late filing penalty.’ 

  • This is not a ‘reasonable excuse’. There is enough time between the end of the tax year (5 April) and the date you must file your return online (19 May)

‘My computer broke down and the data was lost so I could not file online.’ 

  • This is not a ‘reasonable excuse’. The fact that the return was sent shows that the information was available for submission. Reasonable care should have ensured that a working computer was available in time

‘Using a computer is too difficult. I am not computer literate.’ 

  • This is not a ‘reasonable excuse’. If you have trouble using a computer, then you should get help. You could consider using a payroll agent or bureau, who could file online for you

‘I was under so much pressure of work that I did not have time to file online.’ 

  • This is not a ‘reasonable excuse’. If the information is available to send, then there is no reason why it cannot be filed online before the deadline. Remember, the penalty is for not filing online when you should, not for filing late

‘My agent or payroll bureau did not file online on my behalf.’ 

  • This is not a ‘reasonable excuse’. You are personally responsible for making sure that your return is filed online

‘I originally sent my return in on paper, but have now sent it in again by filing online.’ 

  • This is not a ‘reasonable excuse’. If you send your return in on paper when you should be filing online you cannot avoid a penalty by following up later with an online return. The Penalty applies if you do not make your return online. Trying to put it right later cannot alter that fact

‘I tried filing online, but could not because I did not meet your Quality Standards for accuracy and completeness.’ 

  • This is not a ‘reasonable excuse’. You must make sure that you use payroll software, which meets our Quality Standard

‘I did not have enough information to complete my online return.’ 

  • We would not agree that you could not complete your online return because you did not have all the information you needed if we get your return on paper

‘HMRC did not tell me that I had to file online.’ 

  • We have written to every employer to tell them how online filing affects them and when they must file online. Where our letters are undelivered, we send them out again as soon as we have a new address. We have also publicised online filing widely, and our staff have been contacting all large employers to remind them that they must