What happens if payroll is filed late?

HMRC charges monthly penalties for late RTI submissions based on the number of employees, starting at £100 a month for very small employers and rising with headcount. The first late submission in a tax year is usually forgiven.

Late payment of the PAYE itself attracts separate penalties and interest. Because payroll deadlines come round every month rather than once a year, small problems compound quickly, which is the main argument for outsourcing it.