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HMRC internal manual

Statutory Payments Manual

From
HM Revenue & Customs
Updated
, see all updates

Penalties - introduction

Penalties for Statutory Payment Offences can be imposed when:

  • an employer

    • refuses or repeatedly fails to make a statutory payment to their employees, see SPM230400 
    • fraudulently or negligently makes an incorrect statutory payment, see SPM231100 
    • fails to include statutory payment information on their end of year return, see SPM230600 
    • fraudulently or negligently includes incorrect statutory payment information on their return, see SPM231300 
    • refuses access to their statutory payment records, see SPM230700 
    • fails to keep statutory payment records, see SPM230800 
    • fraudulently or negligently produces incorrect statutory payment records, see SPM231400 
    • fails to give required statutory payment information to their employees, see SPM231000 
    • fraudulently or negligently provides incorrect statutory payment information to their employees, see SPM231500 
    • fraudulently or negligently obtains incorrect statutory payment funding, see SPM231700 
  • anyone

    • fails to comply with a Formal Information Notice, see SPM230500 
    • fraudulently or negligently provides incorrect information or documents in response to a Formal Information Notice, see SPM231200 
    • fraudulently or negligently makes an incorrect statement or declaration to establish entitlement to a statutory payment, see SPM231600.

Penalties determined by HMRC

HMRC has authorised the following officers to determine statutory payment penalties for any refusal or failure to pay a statutory payment:

any officer at Pay Band Grade 6 or above serving in:

  • Personal Tax, Customer Product and Process (PTCPP)
  • NIC&EO
  • SCI, LBS or Local Compliance.

Penalties determined by The First-tier Tribunal

The First-tier Tribunal determine statutory payment penalties to do with any failure to provide information or access to documentation.

HMRC’s authorised officers can make applications for such determinations.

The authority is provided for under:

paragraph 4 of Schedule 1 of the Employment Act 2002, or

paragraph 4 of Schedule 1 of the Employment (Northern Ireland) Order 2002 (SI2002/2836)

A penalty may not be determined after any failure has been made good.

Where an employer refuses access to records, the Senior Manager should contact the Tax Administration and Advice team.

Authority to impose a penalty or make an application for a penalty determination cannot be delegated by an authorised officer to any other officer. When a penalty determination or application is appropriate, the forms have to be signed by the authorised officer.

Time Limits

A penalty may be determined or penalty proceedings may be taken at any time within six years after the date on which the offence occurred or began to occur.

Paragraph 7 of Schedule 1 to the Employment Act 2002 (EA2002) 

Paragraph 7 of Schedule 1 to the Employment (Northern Ireland) Order 2002 (E(NI)O2002) (SI2002/2836) 

There is a right to appeal against the imposition of the penalty, see SPM231900.