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HMRC internal manual

Compliance Operational Guidance

Supporting Guidance: employer compliance: guidance by subject: penalties: CIS from 06-04-07 - making an incorrect declaration (form CIS300)

The CIS300 contractor monthly return includes a declaration

  • that none of the contracts to which the return relates is a contract of employment,
  • that each subcontractor on the return has been verified or included on previous CIS returns in the last two years and
  • that the return is correct and complete.

Regulations 4(5)(a) - 4(5)(c) Income Tax (Construction Industry Scheme) Regulations 2005 require a contractor to include this declaration in the return.

COG914280 gives advice on penalties where a contractor fails to make the declaration on the CIS300 contractor monthly return.

A contractor who fraudulently or negligently makes an incorrect declaration can be liable to penalty not exceeding £3000 under the provisions of S98(2) TMA 1970.

Wherever a contractor has made an incorrect declaration on the return you must

  • establish the reasons why an incorrect declaration was made COG906110 and
  • contact Tax Administration Litigation & Advice for advice before seeking a penalty under S98(2) TMA 1970 - see COG904770.

TALA will

  • provide advice on whether to pursue the penalty.