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CIS complexity
Key points
- HMRC can use the CIS Regulations to recover underpaid tax arising from failures to comply with the construction industry scheme rules.
- The contractor may be able claim reasonable excuse using reg 9(3).
- Regulation 13 allows HMRC to make a determination on the contractor on unremitted CIS liabilities.
- In Gelder the tribunal decided the company had adequate controls in place but in North Point (Pall Mall) Ltd the company was deemed not to have taken reasonable care.
The construction industry scheme (CIS) rules contain significant powers which HMRC can apply if it believes that a contractor has not complied fully with the rules.
Before looking at two recent First-tier Tribunal decisions Gelder Ltd (TC8236) and North Point (Pall Mall) Ltd and China Town Development Company Ltd (TC8205) it is worth looking at the specific rights of HMRC in these particular situations.
Regulation 9(4)
If...
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