HMRC internal manual

Construction Industry Scheme Reform Manual

Register and maintain subcontractor: appeals against refusal or cancellation of Gross Payment Status: introduction

You should check the other guidance available on GOV.UK from HMRC as Brexit updates to those pages are being prioritised before manuals.

CISR48600 Action guide contents


This paragraph serves as an introductory overview of appeals against the refusal of gross payment applications; for deeper coverage use the above links to information or action guides.


This section on the conduct of appeals against the refusal of gross payment applications covers the process from queries about refusals or receipt of a notice of appeal to its settlement, either by agreement with the applicant or following determination of the appeal by the tribunal.

The subcontractor has the right to accept the decision maker’s opinion of their appeal (ARTG2700), or to take up the offer of review if they do not agree with the decision maker (ARTG4000). Alternatively, the subcontractor can notify the appeal to the tribunal (ARTG8200) so long as an appeal has already been made to HMRC.

Tax treatment appeals made by a subcontractor who is an individual or a partner in a partnership, should be handled by NIC&EO Longbenton, and those for companies will be handled also by the CT CIS Centre at Newcastle.

Appeals will be handled at these locations up to the point where

  • the appeal is accepted in the subcontractor’s favour, or
  • the decision maker’s opinion is confirmed and the subcontractor accepts that decision, or
  • an internal review is taken up by the subcontractor, or
  • the subcontractor notifies the appeal to the Tribunals Service.

There may be more than one reason why an application has failed the tests for gross payment status and the applicant will have been told of all the reasons why the application has failed in the decision letter. The decision letter may include more reasons for cancellation than were identified by TTQT or set out in the CIS308 cancellation notice. When an appeal is to be heard before the tribunal it is important that the hearing deals with all the reasons why the application has failed at the same time.

Once an appeal has been logged against a change of Tax Treatment, CISR will suspend any action to change the subcontractor’s tax treatment from gross to net where cancellation is made with notice. Where notifications have already been sent to contractors (this is normally after day 55 of the 90 day notice period) to change the tax treatment to net, CISR automatically changes the Tax Treatment back from net to gross. These contractors will then be advised that Gross Tax Treatment has been re-instated.

If the appeal is received and accepted after the 90 day notice period, CISR will again re-instate Gross Tax Treatment and inform the relevant contractors. Where the Tax Treatment had been changed from gross to net without a period of notification (say, following a Compliance Review), then CISR will not change the Tax Treatment status back from net to gross in these circumstances whilst the subcontractor’s Tax Treatment appeal remains open.

Appeals not covered in this section

Appeals and disputes relating to other work areas within the Construction Industry Scheme are covered in the following sections.

Regulation 13 determinations on Contractors CISR82070
Refusal to make a Regulation 9 Direction CISR83060
Refusal of credit or repayment for CIS deductions CISR75050
Disputes between contractor and subcontractor CISR72130