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HMRC internal manual

Construction Industry Scheme Reform Manual

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HM Revenue & Customs
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The Scheme: secondary legislation: SI2008/740

This Statutory Instrument amends Reg 2, Reg 11, Reg 16 and Reg 57 SI2005/2045 and the revised text for each is as follows;

Regulation 2 (interpretation)

This amendment inserts new definitions in the list as follows;

‘combined amount’ means an amount which includes an amount the contractor is liable to pay under these regulations and one or more of the following;

  1. earnings-related contributions due under the SSC Regulations;
  2. tax due under the PAYE Regulations;
  3. payments of repayments of student loans under the Student Loan Regulations;

‘SSC Regulations’ means the Social Security (Contributions) Regulations 2001

‘Student Loan Regulations’ means the Education (Student Loans) (Repayment) Regulations 2000 or, in Northern Ireland, the Education (Student Loans) (Repayment) Regulations (Northern Ireland) 2000.

Regulation 7 (payment, due date for payment of amounts deducted and receipts)

Paragraph 3(b) now reads;

‘any tax deducted under the PAYE Regulations, and’

Regulation 8 (quarterly tax periods)

Paragraph 4 now reads;

‘In this regulation;

‘employed earner’ has the same meaning as in the SSCBA;

‘SSCBA’ means the Social Security Contributions and Benefit Act 1992, or in Northern Ireland, the Social Security Contributions and Benefit (Northern Ireland) Act 1992;

Regulation 11 (notice and certificate if amount may be unpaid)

Paragraph 4 now reads;

‘An Officer of Revenue and Customs, on consideration of the contractor’s record of past payments whether of deductions under section 61 of the Act (deductions on account of tax from contract payments) or of combined amounts, may;

  1. specify, to the best of his judgment, the amount due under regulation 7 or a combined amount which he considers the contractor is liable to pay, and
  2. serve notice on the contractor requiring payment of the specified amount within 7 days of the issue of the notice (‘the notice period’)

Paragraph 6(a) now reads;

‘claims that any payment made in respect of the tax period specified in the notice is or includes the full amount the contractor is liable to pay under regulation 7, but’

Paragraph 8(a) now reads;

‘the amount unpaid is treated as or including an amount which the contractor was liable to pay for that tax period under regulation 7, and’

Paragraph 10 now reads;

‘Paragraph 11 applies if the contractor pays an amount of deductions under section 61 of the Act, whether separately or as part of a combined amount certified under this regulation which exceeds the amount the contractor would have been liable to pay in respect of that tax period apart from this regulation’

Paragraph 11 now reads;

‘The contractor is entitled to set off the excess of deductions under section 61 of the Act against any amount which the contractor is liable to pay under regulation 7 for any subsequent tax periods in the tax year’.

Regulation 16 (recovery of amounts unpaid and interest)

Paragraph 2 now reads;

‘Part 6 of TMA (collection and recovery) applies to the recovery of the unpaid amount or combined amount and any interest on it as if it were income tax charged on the contractor but with the modification indicated in paragraph (3)’

Table 1 in Paragraph 3 now reads;

1.Regulation 2. Period
   
   
Regulation 10(6), 11(8) and 13(2) 1. 12 months after the date on which the unpaid amount or combined amount and any interest on it became payable, or
2. If a return has been required under regulation 10, 12 months after the date of the delivery of that return to the Commissioners for Her Majesty’s Revenue and Customs  
Regulation 12(2) 12 months after the date of the certificate

Paragraph 4 now reads;

‘Proceedings against a contractor may be brought for the recovery of the unpaid amount, or unpaid combined amount and any interest on it, without distinguishing the amounts which the employer is liable to pay in respect of each subcontractor and without specifying the subcontractor in question’.

Paragraph 5 now reads;

‘The unpaid amount, or unpaid combined amount and any interest on it, is one cause of action or one matter of complaint for the purposes of proceedings under Section 65, 66 and 67 of TMA (magistrates’ courts, county courts and inferior courts in Scotland)’

Regulation 57 (quarterly tax periods)

After Paragraph 2, a new paragraph 2A is inserted with the following text;

‘An officer of Revenue and Customs may prepare a certificate showing the whole or part of a combined amount which includes deductions under section 61 of the Act without specifying the components of the combined amount.

Paragraph (1) shall apply with any necessary modifications to the certificate’.

Paragraph 3 now reads;

‘A certificate of an officer of Revenue and Customs that, to the best of his knowledge and belief, any amount of interest payable under regulation 14 (interest on amounts overdue) has not been paid by a contractor, is sufficient evidence that the amount mentioned in the certificate is unpaid and due to the Crown’.

After Paragraph 3, a new paragraph 3A is inserted with the following text;

‘An officer of Revenue and Customs may prepare a certificate showing the total amount of interest payable in respect of the whole or any component of the combined amount without specifying which component of the combined amount the interest relates to.

Paragraph (3) shall apply with any necessary modifications to the certificate’.

Paragraph 5 now reads;

‘A document which purports to be a certificate under this regulation is treated as such a certificate until the contrary is proved’.