Motor dealers unfairly issued with a HM Revenue & Customs (HMRC) PAYE filing penalty notice for 2005/06 have until April 23 to appeal, or risk paying the fine.

The notices, issued on March 12, were sent out nine months after the filing deadline of May 19, 2006. In each case the fine was for £900.

“However, by the date of receipt, typically March 21, a further month had lapsed adding a further £100,” says Bett Twiggs of Trevor Jones.

“HMRC are expecting employers to bring the mistake to their attention. A formal appeal against the penalty notice must be made by April 23, otherwise it will be deemed conclusive and therefore payable even if wrong.”

Martin Duckworth Land Rover in Market Rasen, Lincolnshire, received a penalty notice on March 27.

“We were completely shocked,” says Gail Smith, accounts manager at the dealership. “Our notice came for Country Trade Ltd, which is owned by us and used to sell part exchanges that aren’t Land Rover. This company has no employees and has never had any.

“We sent a letter to appeal and got a reply on April 10 saying that they wouldn’t ask for payment until the appeal is settled. We’re just waiting now.”

Approximately 154,000 penalty notices were sent to employers. Twiggs says that the problems came from HMRC’s online filing system.

“Unfortunately even after three years and previous problems, HMRC managed once again to get it wrong, blaming computer problems. Many of the penalty notices have been incorrectly issued to dormant companies where there is no liability, or to companies who have received a receipt for the online submission,” says Twiggs.

In response, the HMRC has reassigned around 200 employees to answer phones and field enquiries.

“Even if the notice is correct because, say, the original has not been correctly submitted, then it may be possible to persuade HMRC to mitigate, in some cases to as little as £100,” says Twiggs.

“What employers must not do is ignore the notice.”