Supporting Guidance: employer compliance: guidance by subject: commencing the compliance check: opportunity to disclose
COG905085 explains the importance of giving the employer/contractor the opportunity to disclose any problems at an early stage.
- ‘have all payments to employees and directors been taxed, NIC accounted for and the payments entered in the pay records?’ or
- ‘have subcontractors been verified by HMRC before payment was made?’
is important because
- it gives the employer/contractor the opportunity to disclose inaccuracy and
- helps establish culpability if inaccuracies are discovered which the employer/contractor failed to mention.
- try and get a straight ‘yes’ or ‘no’ reply.
If necessary you should
- repeat the question to make sure the employer/contractor has understood it and/or
press for a specific response where the employer/contractor
- attempts to avoid the issue or
- fails to give a straight answer.
We cannot force a straight reply. Make a clear note of any reply given to you.
Where the answer is ‘no’ you should
- establish what the payments are for and the systems in place to account for the payments
- test the system and
- issue factsheets CC/FS7a Penalties for inaccuracies in returns or documents, CC/FS19 Employer and contractor returns and ‘old’ penalty rules, provide HRA advice where appropriate and issue factsheet CC/FS9 The Human Rights Act and penalties, see COG906060.
The employer’s/contractor’s response must be recorded in the Notes of Meeting (COG905295).