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HMRC internal manual

Construction Industry Scheme Reform Manual

The Scheme: secondary legislation: regulation 17

This regulation deals with in-year repayments.

The regulation applies where -

  • the subcontractor is a sole trader or a firm
  • an application has been made to HMRC by the sole trader or partner in accordance with (4)
  • all income tax and Class 4 NICs have been paid by the sole trader or partner on their share of the profits or gains from the trade, profession or vocation of the subcontractor for any earlier year
  • all payment vouchers have been submitted to HMRC that were received by the subcontractor under Regulation 7 IT(Subs in the CI) Regs 1993 in respect of payments made before the introduction of the new scheme: SI2005/2045 reg 17(1) (a) to (d).

If HMRC are satisfied that a repayment is due, the subcontractor, subject to (5), is entitled to receive repayment of any excess: SI2005/2045 reg 17(2).

The calculation of the in-year excess is given at SI2005/2045 reg 17(3).

A declaration must be made to HMRC that all information provided in relation to (3) is complete and correct. Where the subcontractor is a sole trader the declaration should be signed by the individual; for firms, all individuals who are partners must sign the declaration; and where the partner is a company, the declaration should be signed by the company secretary or a director: SI2005/2045 reg 17(4).

This regulation cannot be applied to repayments made after the end of the year to which the application relates: SI2005/2045 reg 17(5).