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HMRC internal manual

Construction Industry Scheme Reform Manual

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HM Revenue & Customs
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Appeals against refusal or cancellation of Gross Payment Status - Re-opening a Tax Treatment appeal

CISR48000 Information guide contents
   

You may need to re-open a Tax Treatment appeal, perhaps because the subcontractor has made a late request (on ‘reasonable excuse’ grounds) for an internal review of the matter. Where this happens CISR will recognise this fact and automatically displays a ‘Re-open’ appeal button instead of a ‘Create New Appeal’ button when you select ‘Maintain TT Appeal’. . To re-open a Tax Treatment appeal you will need to be in the CISR Tax Treatment Administrator role, and the steps you need to take are shown below:

Step 1

From the CIS Main Menu

  • select the registration against which the Tax Treatment appeal has been made
  • select [Maintain TT Appeal] from the menu options supplied at the bottom of the page.

This will take you to the ‘Maintain Appeal’ window. The subcontractor’s name will be displayed along with their UTR, and where the subcontractor is appealing against their tax treatment as a member of a partnership, the partnership name and partnership UTR will also be displayed.

On the same page under the bar entitled ‘Appeal History’ is a list of all the appeals made by the subcontractor under that particular registration for the current year and the previous six years (CY-6). The following headings will be displayed.

Date Received

This will show the date each Tax Treatment appeal was received, and they will be displayed in descending order, with the most recent shown at the top.

Appeal

This will display the current status of each appeal made whether it is still open or now determined. The available options for display will be the following:

  • Received
  • Withdrawal Invited
  • Being Reviewed
  • Withdrawn
  • Upheld by HMRC
  • Listed for Personal Hearing
  • Late Appeal accepted at Personal Hearing
  • Late Appeal rejected at Personal Hearing
  • Upheld at Personal Hearing
  • Rejected at Personal Hearing
  • Upheld in favour of HMRC
  • Upheld in favour of subcontractor
  • Re-opened
  • Re-opened withdrawn by HMRC
  • Re-opened withdrawn by subcontractor

A full description can be found at CISR48070 of what each of these categories means.

Appeal papers location

This will display the location of the appeal papers for each of the appeals listed with the exception of any ‘open’ appeal. The District Record (DR) number will be displayed where the appeal papers are filed. This field can be completed at any time whilst the appeal is ‘open’.

Date of Determination

This will display the date each appeal was finally determined, unless the appeal is still open.

Step 2

To re-open a Tax Treatment appeal

  • select the [Re-open Appeal] button.

A dialogue box will now appear with the following text ‘No automated acknowledgement will be issued for re-opened appeals. A manual acknowledgement letter should be considered.’

  • select [OK], this will clear the dialogue box

This will take you to the ‘Appellant Details’ window. This will display the subcontractor’s name along with their UTR, and where the subcontractor is appealing against their tax treatment as a member of a partnership, the partnership name and partnership UTR will also be displayed.

On the same page under the title bar ‘Select Appellant’ and alongside the words ‘Represented By’ is a drop down menu. This will default automatically to the person who submitted the original Tax Treatment appeal. However, should you wish to change the appellant, you may do so by selecting one of the following options:

  • Customer
  • Agent
  • Third Party

Where you select the ‘customer’ heading the ‘Recipient Name’ field is greyed out, having defaulted to the subcontractor’s name but you will still be able to alter the address.

Select either

  • HMRC Base Address
  • CIS Communication Address

Where the agent option is selected under the ‘Recipient Name’ field you will need to select which agent the notification is to go to, where for example the subcontractor has both a Customer Level Agent and Scheme Specific Agent acting for them (See CISR19000). An entry should also be made in the ‘Customer’s Appeal reference’ where the agent has shown an agent’s reference relating to the subcontractor.

Note The date the appeal was received field will not be displayed here, as is the case when creating a new appeal, as CISR will already know this date from the original date the appeal was logged.

  • Select the [Next] button.

Step 3

This takes you to the ‘Appeals Details’ window. Under the title bar ‘Maintain Appeal Details’ you will note that CISR has already populated the date the appeal was received. CISR has done this from the entries that were made when the appeal was originally logged, and where the appeal was made late, CISR has also calculated the number of days by which the appeal was made late.

The next field down will display the reason for the subcontractor having net Tax Treatment, this will be one of four options, and will be automatically pre-populated and cannot be altered.

  • Request for Gross denied
  • Tax Treatment Review
  • Manual change without (90 day) notice
  • Manual change with (90 day) notice

The minimum entry that can be made on the ‘Appeals Details’ window to allow a Tax Treatment Appeal to be re-opened is the following.

  • Select [Re-opened] from the drop-down menu alongside ‘Appeal Progress’.
  • Select one of the following from the drop-down menu alongside ‘Reason for re opening’

    • Withdrawal from agreement
    • Permission to appeal tribunal decision / High Court
    • Determined in error
    • Other
  • Then select [OK]

If you are re-opening the appeal only and are now going to pass it to another officer to work, you may now go down to step 6 below.

Step 4

When working the appeal there are further entries to be made on this window.

  • Select one of the following from the drop-down menu beside ‘Grounds for Appeal’

    • Reasonable Excuse
    • HMRC admin error
    • Disputed result
    • Other

Step 5

You must also make entries identifying the failures found during the Tax Treatment Qualification Test (TTQT) against which the subcontractor is now either appealing or disputing.

  • Select the appropriate box or boxes alongside each entry besides ‘Failures Disputed’. The possible entries are

    • Scheme payment
    • CIS Return submission
    • PAYE Return submission
    • SA Payment
    • SA Return submission
    • CT payment
    • CT Return submission
    • Other

Where the nature of the appeal does not fit into any of the first seven categories above, then

  • select [Other]

Step 6

Having re-opened the appeal, you will now need to make a note of what action you have taken regarding the appeal (See CISR48720 for more information regarding this), for example, where you have passed this to another officer. To do this

  • select the [Add Notes] button
  • make a free-format note of the action taken and to whom the appeal has been passed
  • select [Back], this will take you back to the ‘Maintain Appeals Details’ window.

    • Select [OK], a message will then display saying ‘Back to Main menu - changes committed’.
  • There are also two further buttons on this window

    • [Back] will take you back to the previous window.
    • [Cancel] will cancel all of the entries you have made in logging this particular appeal, an error message will be displayed saying that ‘This will take the user back to the CIS main menu with all data lost’.

CISR will then suspend any action to change the subcontractor’s tax treatment from gross to net, and 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 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 this case, whilst the subcontractor’s Tax Treatment appeal is still open.

You must remember to issue a manual letter to the appellant or their agent acknowledging the request made to re-open the tax treatment appeal.

Once the appeal has been re-opened, to work the re-opened appeal you should follow the appropriate action guides set out at CISR48600.