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HMRC internal manual

Construction Industry Scheme Reform Manual

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HM Revenue & Customs
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Monthly return: errors on returns: typical scenario examples

CISR66600 Action guide contents
   

This information panel provides examples by way of typical scenarios to illustrate how errors and omissions made on a return are corrected. They do not cover everything you’ll see, but will provide you with a flavour for things.

Example 1 - simple error

Company B complete their CIS300 return for the period between 6t h August and 5t h September 2009 and take it into their local Enquiry Centre on 10t h September 2009. It includes details of a number of payments to subcontractors, one of whom is Alan Carthy.

Mr Carthy is entitled to payment under deduction and has been verified. The return shows that he has been paid £3,700 with a deduction of £620.

The return is date stamped by the EC and sent to Netherton in a polylope the following day where it is logged, scanned and captured. Both the UTR and the AO reference on the return are matched to Company B’s CIS record and the return record is therefore noted as ‘effective’.

On 15t h September though, Company B notice two mistakes on the return. Firstly, they’ve misread their payroll records relating to the payments made to Mr Carthy; the actual payment made was £3,100 with a deduction of £620. Secondly, they’ve omitted a gross payment of £300 to ABC Ltd.

Note that the ‘return details’ window on the CIS system may already show that the original ‘effective’ return may include errors. An ‘!’ mark in the far left-hand column against a subcontractor payment entry might suggest (for example) that an incorrect deduction may apply to a captured payment.

To rectify this they complete a new CIS300 for the same period but showing the right information. To save time and as the due date is fast approaching, they send the new return directly to Netherton.

On logging the return, CIS will show that one already exists for the period in question. An ‘exception report’ follows and a work item (WI) is created. The return is then passed to the HMRC back office at Netherton. CIS, having matched the return to the company’s UTR and AO reference, changes the status to ‘multiple’. This reflects that more than one return has been made for the same period.

The CIS Centre Newry contact the company who tell them that the new return contains the right information and is meant to replace that logged on 10t h September. On receipt of this information, the CIS Centre Newry is able to capture the new return by ‘making effective the multiple return’. The new one replaces the old and CIS core shows a return status change of the original ‘effective’ to ‘superseded’.

The action guide at CISR66620 shows you how to correct a simple error on an ‘effective’ return.

The action guide at CISR66630 shows you how to deal with unresolved multiple returns for the same scheme and period.

Example 2 - incorrect AO reference and return period details

The same details for Company B as in example 1 above. However, when sending in the new CIS300 showing the corrected information in respect of the payments made to Mr Carthy and ABC Ltd, they enter the return period as 31/08/2009 (instead of 05/09/2009) and misquote their AO reference - they show it as 123123456 instead of 123PJ00123456.

On attempting to log the return it becomes ‘unmatched’ and a work item (WI) is created.

The action guide at CISR66640 shows you how to deal with unmatched returns.