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HMRC internal manual

Construction Industry Scheme Reform Manual

HM Revenue & Customs
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Late Return Automatic Penalties: Re-opening a Penalty Appeal

CISR65000 Information contents

Note, There is no separate ‘Re-open Penalty Appeal’ function within CIS Main Menu. You will need to use the ‘Create Penalty Appeal’ function instead.

To access this function you will need to hold any of the following roles; CISR Processor, CISR Process Manager or CISR Penalty Administrator.

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

The next window is divided 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 who submitted the appeal. The entries you make will decide to which recipient and address the system will issue the appeal acknowledgement. The fields in the lower panel will be pre-populated with the entries made when the original appeal was logged or determined, you should now review and make any necessary changes to the entries in these field which 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 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 customer’s name.
    • Agent - By selecting ‘agent’ you will need to decide which agent the appeal acknowledgement 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 these two types of agent). The appeal acknowledgement (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 acknowledgement (CIS320) will be sent direct to the customer, but it will advise them to pass it to the third party representative.
  • Address for Acknowledgement (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 the drop-down menu and should be selected if you want the appeal acknowledgement to be sent to the CIS Communication address instead.
  • Customer’s Appeal Reference - This field is for use where an agent sends in an appeal on behalf of a contractor.

Having completed the above fields (where appropriate) select [Next].

This takes you to the ‘create Penalty Appeal’ window which consists of two panels with the scheme name and AO reference in the top panel. The lower panel titled ‘Penalties’ provides details of the late return penalties issued during the last six months to that scheme. A maximum of 10 penalties is listed on each page, penalties in excess of this will be shown on subsequent pages and can be accessed by selecting the page number or by selecting ‘next’ which takes you to the next page.

If no CIS penalties are displayed as they were issued more than six months ago or you wish to view CIS penalties issued more than six months ago, you should;

  • select the ‘Show all Penalties’ button

Having done this, to return to the previous window you should;

  • select ‘View six months’ at the bottom of the list

This panel will be populated with the following columns;

  • Reference - this will be the SAFE reference attached to the penalty
  • Type - indicates the type of penalty, entries being;

    • for penalties issued under TMA70/S98A, late filing or final late filing.
    • for penalties issued under FA09/SCH55 this will be FP1, FP2, TGP1 or TGP2 (see CISR65050).
  • End Date - this will indicate the month and year of the return the penalty relates to.
  • Instance - the first 2 digits (outside the brackets) relate to the penalty instance for that return. The filing date to which this penalty relates will then follow. For example, 01 (19 08 2008) would be the first penalty instance relating to the monthly return ended 05/08/08 due to be submitted to HMRC by 19/08/08. This will appear for CIS penalties issued under TMA70/S98A but this field will remain empty for CIS penalties issued under FA09/SCH55.
  • Issue Date - this will be the date of issue or the date of the last amendment of the CIS penalty
  • Amount - is the current amount of the CIS penalty charged
  • Status - this is the current status of the CIS penalty, entries will be issued, re-issued or vacated.
  • Appeal Progress - displays the current state of any appeal made against the CIS penalty

You should now match the appeal with the appropriate penalty and select the box to the left of the CIS penalties being appealed against. The ‘Appeal Progress’ for this penalty will show that it has been determined and will show a status of ‘Withdrawn’, ‘Determined by agreement’, or ‘Upheld in favour of HMRC’.

* Select the [Create Appeal] button

This will take you to the ‘Re-open Penalty Appeal’ window. The top panel contains the scheme name and AO reference, the middle panel lists the penalty (or penalties) selected to be re-opened and the first two fields within the lower panel will be pre-populated with the entries made when the original appeal was logged or determined. You will need to review these fields for any changes required as follows;

  • Grounds for Appeal - select the appropriate entry from the drop down menu. The selections being;

    • Reasonable Excuse - to be selected where the appellant offers a ‘reasonable excuse’ as the grounds for their appeal
    • HMRC admin’ error - this will be appropriate if the appeal suggests the return was issued in error of there was some other HMRC error.
    • Other - this will apply when the grounds for appeal are not fitting to the other options.
  • Location of Appeal Papers - this field will be pre-populated with the district record reference of the folder where the appeal papers are filed when the appeal was previously determined. If this is to be changed this entry can be over-written.
  • Reason for Re-opening - Use this field to list the most appropriate reason from the drop down menu for re-opening the appeal. The selections are;

    • Withdrawal from Agreement - where the appellant (or HMRC) wishes to withdraw from the agreement reached when the appeal was determined.
    • Stated Case (Permission to Appeal) / High Court - where Permission to appeal has been sought against the tribunal decision by either the appellant or HMRC.
    • Determined in error
    • Other - this is to be used where none of the other selections are appropriate
  • Select the ‘Add notes’ button

You should make a note of the reason of why the appeal has been re-opened and the action you are taking in order to settle the re-opened appeal. Each time an update is made you must include your PID at the beginning of the note as the system will only record a date and time of each note.

  • Select the [Accept] button to re-open the appeal.

This takes you back to the ‘Create Appeal’ window.

  • Select [OK] to return to commit the changes made and return to the CIS Main menu.

An acknowledgement will not be issued automatically but the charge will be suspended once [OK] is selected. You should therefore consider preparing a manual acknowledgement to the customer or their representative.

Once the appeal has been re-opened, to work the re-opened appeal follow the appropriate information panel set out at CISR65120, Determining an Appeal.