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Feedback relating to query T16,015 published with replies in the Readers' Forum, issue 30 May 2002.
Synopsis of query
A subcontractor was currently holding a CIS 6 certificate but his application for it to be renewed was formally refused by the local tax office on the grounds that, although his tax returns had been submitted on time, his tax liabilities had not been paid on time; as a result surcharge liability notices had been issued for the two most recent years.
Feedback relating to query T16,015 published with replies in the Readers' Forum, issue 30 May 2002.
Synopsis of query
A subcontractor was currently holding a CIS 6 certificate but his application for it to be renewed was formally refused by the local tax office on the grounds that, although his tax returns had been submitted on time, his tax liabilities had not been paid on time; as a result surcharge liability notices had been issued for the two most recent years.
Summary of published replies
'Beacon' considered that the late payment of tax liabilities could not be regarded as a minor or technical failure which, according to section 562(13), Taxes Act 1988 may be disregarded by the Revenue at its discretion when considering the renewal of a CIS 6 certificate. Accordingly, there was little hope for an appeal to succeed.
'Accountax' pointed out that the Revenue's leaflet IR40 (CIS) suggests that two late surcharges means no certificate renewal, but this is only Revenue interpretation and guidance. It does not supplant the law and the General Commissioners may not take well to being told how to exercise their own discretion by the Revenue.
Outcome
The querist has reported that an appeal has now been heard by the General Commissioners and was successful. The grounds of appeal were that there were mitigating circumstances in the case due to a poor payment record by the main contractor. The points made by 'Accountax' were also put to the General Commissioners who were reminded that the case had been handled by a junior member of staff at the Revenue and each application should be judged on its own merits.
As a result, the General Commissioners granted a CIS certificate for a period of twelve months with an undertaking that he can apply for a three year certificate in March 2003.
Those who submit queries to the Readers' Forum are requested to report back on the eventual outcome of the particular problem so that the final picture can be summarised as a 'You Said It!' item in the magazine.
