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HMRC internal manual

Construction Industry Scheme Reform Manual

HM Revenue & Customs
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Late Return Automatic Penalties: Determining an Appeal

CISR65000 Information contents

This action guide outlines how to determine an open penalty appeal you must hold the CISR Penalty Administrator role.

Where you are determining more than one CIS penalty appeal, you should first use the function ‘Update penalty appeal’ to add notes about why and how you are determining the appeal, this will allow you to add the same note against multiple CIS penalties, whereas the ‘Determine penalty appeal’ function will allow you to add only one note against one CIS penalty at a time.

  • From the CIS Main Menu select the required contractor scheme and then select ‘Determine Penalty Appeal’ from the menu.

The next window is divided into two panels. The top panel titled ‘Appeal Letter Recipient’ displays the name and AO reference of the contractor scheme. The lower panel titled ‘Select Appellant’ is where the scheme representative or customer that submitted the appeal is shown. The entries you make will decide to which recipient and address the system will issue the determination of the appeal. The fields to be completed in the lower panel are as follows;

  • ‘Represented By’ - The drop down menu will give you the following choices:

    • Customer - This field will initially default to ‘customer’ and will be where appropriate if the customer is ‘unrepresented’.
    • Agent - Will be for when the customer has a scheme specific or customer level agent acting for them.
    • Third party - this field is selected if the appeal was submitted by a friend or relative.
  • ‘Recipient name’ - This field will be automatically populated as follows when the appropriate drop-down is selected in the ‘represented by’ field:

    • Selecting ‘customer’ will display the customers name here
    • Agent - By selecting ‘agent’ you will then need to decide which agent the appeal determination should be issued to. This will be relevant where there is both a scheme specific agent as well as a customer level agent acting, (See CISR19000 for further details relating to the two types of agent). The appeal determination (CIS320) will be sent to the scheme address as well as the appropriate agent identified.
    • Third party - Selecting ‘third party’ will mean that the appeal determination (CIS320) will be sent direct to the customer, but it will advise them to pass it top the third part representative.
  • ‘Address for Determination (drop-down menu)’ - This will be automatically populated with the HMRC base address. Where the scheme has a CIS Communication address set, this option will appear on this drop-down and should be selected if you want the appeal determination (CIS320) to be sent to the CIS Communication address instead.
  • Customer’s Appeal Reference - This field is intended for use where an agent has sent in an appeal on behalf of a contractor.
  • Select the ‘Determine Appeal’ button at the left of the window

This takes you to the ‘Determine Penalty Appeal’ window which is divided into three panels. The top panel displays the scheme name and reference number. The middle panel titled ‘Selected Appeal Details’ remains ‘greyed out’ until such time as the CIS penalties that you wish to determine have been selected in the lower panel.

‘Selected Appeal details’ and ‘Appealed Penalties’ panels

The lower panel lists all the appeals currently ‘open’, where there are more than 10 ‘open’ penalty appeals these will be arranged on separate pages. If there are no open appeals details of all the closed appeals will be displayed instead. However, if there are no open or closed appeals for the panel remains empty and an advisory message will be displayed.

From 29th October 2011 this panel will display to you all ‘open’ penalty appeals for CIS penalties issued under TMA70/S98A and FA09/SCH55 and these will be arranged initially by ascending date issued order, although you can filter these into a different order by selecting the column title on all of the columns displayed.

Before determining an appeal you must make a note of the action you are taking and why, this note must also include your PID.

  • Select anywhere along the line of the CIS penalty that you wish to determine

This will make the ‘Add notes’ button in the panel above become ‘live’

  • Select ‘Add notes’

Add a note of the appeal outcome along with your PID then;

  • Take a screen print of the appeal notes and file these with the appeal papers

For the method of printing the appeal notes see CISR65680 

  • Select ‘Back’
  • Complete the entries in the ‘Selected Appeal Details’ panel as follows;

    • Date Determined - enter the date the appeal was determined

This will be the date of the tribunal hearing where the penalty appeal was heard before a tribunal otherwise this will be ‘today’s date.

* Appeal outcome - select the appropriate category in the drop down menu. For details of the various appeal outcomes and the effect on the penalty, see [CISR65130](
* Determination amount: The Determination amount is automatically generated (in most cases), dependent on the appeal outcome selected. Where the appeal outcome is set to ‘Upheld in favour of HMRC’ for a final late filing penalty issued under TMA70/S98A, or it is a tax geared penalty issued under FA09/SCH55 (TGP1 or TGP2) then you will be able to manually alter the Determination amount.
* Location of appeal papers: Record the reference of the folder where the appeal papers are to be filed.

To determine the appeal;

  • Select the ‘Determine’ button

To the left of the CIS penalty selected for determination a ‘D’ is now displayed. Selecting the ‘Determine’ button simply stores your intention to ‘Determine’ within the current session and allows you now to select other CIS penalty appeals for determination by repeating the steps from ‘Date Determined’ above.

If you wish to undo the determination you should;

  • select the check box immediately to the left of the CIS penalty
  • select the ‘Undo Determination’ button

The ‘D’ will then disappear but the system will retain any other penalty determinations you have made within the same session.

If you now wish to finally determine all of the penalty appeals selected for determination within this session

  • Select the [OK] button

This will then send all the determinations made and return you to the CIS Main menu.

It is your responsibility to check the position using the function ‘Maintain Penalty Inhibition’ to decide whether any penalty inhibitions previously set should remain. The appellant must be informed in writing of any inhibitions to be lifted.

An Appeal Determination letter (CIS320) will be issued automatically by the system and will include all of the penalty determinations made within the same session. Finally, SAFE will issue an amended penalty notice giving a new 30 day appeal period (if applicable) however the due and payable dates remain as on the original penalty notice.

Note PEGA will only be used up to the point that the Decision Maker either upholds the appeal or issues the decision letter. At that stage, the penalty appeal work item is marked as ‘Complete’ (see CISR95070), and a spreadsheet held centrally at Newry will be maintained in order to monitor the various timeframes for the appellant to ask for an internal review, or to make an appeal direct to the Tribunal.