SolvedCH154180 | Penalties for Failure to Pay on Time: Rules for specific taxes: Registered Pension Scheme (RPS): Penalties: Example
From HM Revenue & Customs · Compliance Handbook
Example of initial and further penalties on an amount of income tax due under the Registered Pension Scheme
Reliable Pensions delivers their return for the 3 months ended 30 June 2013 showing it is due to pay £1,200,000 of income tax due under the Registered Pension Scheme on 14 August 2013. But it fails to make any payment. Reliable Pensions makes some payments at later dates, as shown in the table below.
The due date is 14 August 2013. The penalty date is 14 September 2013. The penalties are as follows.
| Payment | Unpaid Tax | Penalty | |
|---|---|---|---|
| Amount due at 14 August 2013 | £1,200,000 | ||
| Initial penalty of 5% on £1,200,000 at 14 September 2013 | £60,000 | ||
| Payment 20 September 2013 | £800,000 | £400,000 | |
| 5 month further penalty of 5% on £400,000 at 14 February 2014 | £20,000 | ||
| Payment 20 March 2014 | £300,000 | £100,000 | |
| 11 month further penalty of 5% on £100,000 at 14 August 2014 | £5,000 | ||
| Payment 20 August 2014 | £100,000 | £0 | |
| Total penalty | £85,000 |