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HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
Updated
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Payment processing and accounting: Certificates of Tax and National Insurance Contributions (NICs)

 

Background

Article 20 of the EC Public Procurement Directive 77/62/EEC gives details of certain requirements businesses must meet before being able to tender for non-UK public sector contracts. One of the requirements is that all Tax and NIC payments are up to date. Applicants normally request formal confirmation of this through the Employers Helpline. In practice though, they may make their request direct to any HMRC office.

Contact points

Where you receive requests for (and enquiries about) Certificates of Compliance, providing that it relates to a tender for a non-UK Public Sector Contract, you should refer them to the following contact point:

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Note: Anything else such as Certificates of Residency, Tax Certificates for Southern Ireland or tenders for private sector contracts inside/outside the UK are not dealt with by this team; these applications should be submitted to HM Revenue & Customs, NIC&EO, NIC&EO PAYE Employer Office, BP4102 Benton Park View, Newcastle Upon Tyne, NE98 1ZZ.

DMB Banking action

Where DMB Banking receive a request for a Certificate of Compliance they will normally process the application within a maximum of 15 days. Urgent cases will be processed within 24 hours where possible.

They will review all of the applicant’s payment records for a period spanning approximately three years prior to the application being received. This will include, where appropriate, Self Assessment (SA), Company Tax (COTAX) and VAT (including duties and levies). If the applicant is payment compliant they will:

  • prepare and issue a certificate to the applicant by first class post
  • issue a copy by fax if the applicant requests one.

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Certificate refusals

When the payment records indicate an unsatisfactory compliance record DMB Banking will advise the applicant (preferably by phone):

  • that the conduct of their tax and NIC affairs is unsatisfactory; and in future:

    • payments should be made by the statutory due date;
    • the certificate of compliance will not be issued until HMRC records indicate a consistent and sustained record of payment compliance.

Where a certificate of compliance is refused the consequence to the applicant may be that their contract tender is jeopardised. It is in the applicant’s best interests, therefore, to bring their payments and return record up to date and maintain this performance for the future.

Compliance criteria

The following criteria will be applied in broad terms when assessing an applicant’s compliance.

PAYE, NIC and VAT (and associated duties and levies)

Applicants should:

  • pay regularly by the required date for the period (for example, each month)
  • have submitted their returns on time (whether that is monthly, quarterly or annually).

Note: During peak periods (for example public holidays) delays may occur in the processing of payments. In such cases applicants should not be deemed non-compliant until after 25th of the month.

SA

Applicants should:

  • make payment on account by 31 January (before end of year of assessment)
  • make payment on account by 31 July (after year of assessment)
  • make the balancing payment by 31 January (after the year of assessment)
  • file their SA return by 31 January (after the year of assessment).

COTAX

Applicants should:

  • pay within £100 of the liability returned, by the normal due date (9 months and 1 day after the Accounting Period (AP) end date) or the 4th instalment due date in a quarterly payment case where the Accounting Period End (APE) is on or after, for example, 01/07/2002
  • file their Corporation Tax Self Assessment (CTSA) return by the filing date for the AP.