Early filing penalty dismissed

The company (Q) had previously incurred penalties for late filing of RTI returns so to avoid future penalties it submitted RTI returns for November 2020 December 2020 and January 2021 in September 2020 – before the due date. The company used HMRC’s basic PAYE tools software and each return had been submitted and marked ‘success’.

HMRC raised late filing penalties on the basis that the returns had been filed too early and therefore had not been filed correctly. FA 2009 Sch 55 para 6C(1) states that a penalty is due if a company fails during a tax month to make a return on or before the filing date. As a return had not been made (for example) in the month of November 2020 the statutory conditions were not met and a penalty was due. In HMRC’s eyes the returns were treated as if they...