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HMRC internal manual

Compliance Operational Guidance

From
HM Revenue & Customs
Updated
, see all updates

Supporting Guidance: employer compliance: guidance by subject: construction industry scheme: CIS - until 5 April 2007 - payments to a third party - inaccuracy discovered

If a contractor made a payment to a third party, without deduction, where

  • neither the subcontractor nor the third party held valid certificates, or
  • a valid certificate was held by the third party but not by the subcontractor, or
  • the third party did not hold a valid certificate, the subcontractor did hold a valid certificate (and did not submit forms CIS24 to cover all payments), or
  • a CIS5 or CIS(Partner) certificate holder used the certifying document method

the caseworker should

  • draw the contractor’s attention to paragraph 7.6 of booklet IR14/15 (CIS)
  • seek recovery for closed years where appropriate.

If a contractor made a payment to a third party, without deduction, where

  • the third party did not hold a valid certificate, the subcontractor held a valid certificate and submitted forms CIS24 to cover all payments
  • both the third party and the subcontractor held valid certificates but forms CIS24 were not submitted

The caseworker should

  • draw the contractor’s attention to paragraph 7.6 of booklet IR14/15 (CIS)
  • advise the contractor on what action should have been taken
  • advise the contractor on how to treat payments to third parties under CIS (Reform) (COG910060)
  • not ask for an open year adjustment to be made and
  • not seek recovery for closed years.