Late filing penalty

Section 139A(5) and (6) of the Tax Administration Act 1994

The amendment specifies that when an employer monthly schedule is filed late a warning will be given, and that late filing penalties will be imposed on subsequent late filing.

Background

The late filing penalty rules require Inland Revenue to impose the penalty when an employer monthly schedule is filed late. However, in practice, the first time an employer monthly schedule is late Inland Revenue warns the taxpayer. If the employer is again late in filing the schedule (within 12 months of the first schedule being filed late), the late filing penalty is assessed on the subsequent late schedule.

The legislation has been amended to reflect Inland Revenue's current practice.

Key features

The late filing penalty rules have been clarified to reflect the current practice of not imposing a late filing penalty the first time an employer monthly schedule is filed late, but rather advising the taxpayer that the schedule is late and warning that subsequent breaches will be penalised. A late filing penalty is payable if a subsequent schedule is filed late in the 12 months following the first breach. If all schedules are filed on time for a year, the process will start again - that is, if a schedule is late, the taxpayer is warned.

Application date

The amendment applies to tax positions taken on or after 1 April 1999 (the date the employer monthly schedule was introduced).