Employers’ mistakes should not be immediately punished under the new PAYE system, the Chartered Institution of Taxation (CIOT) has told HMRC.

The professional body has called on the taxman to widen the remit of the amnesty period for real-time information (RTI) so that no penalties are levied on firms that submit inaccurate returns for the first several months.

The Revenue’s current proposal is to sanction erroneous submissions as soon as Finance Bill 2013 gains royal assent in around July, when RTI will be launched. Fines for late in-year returns will not be introduced until April 2014.