CIS: verification procedures in DM: contractor disputes amount of payment / deductions
Where the contractor disputes the amount of payments and/or deductions shown on the subcontractor’s Payment and Deduction Statement or other evidence of deductions:
- obtain the contractor’s reasons in writing for disputing the figures
- ask for the contractor’s own evidence such as cash/wages book information, showing actual payments (and deductions, if appropriate) made to the subcontractor during the relevant period.
Contractor’s explanation satisfactory
If you are satisfied with the contractor’s written explanation:
- arrange for the return details to be amended on the system, where necessary
- advise the CIS Unit of the outcome of their enquiries
- advise the subcontractor’s processing office of the outcome
- confirm the amount of credit for any deductions not in dispute.
Contractor’s explanation not satisfactory
If you are not satisfied with the contractor’s explanation:
- obtain the contractor’s written confirmation in respect of any amounts not in dispute, which the contractor has not already returned to HMRC
- ensure they file CIS 3000 electronically
- advise the contractor that they are accepting the documents without prejudice and will be referring the papers to the associated CIT and further enquiries may follow
- refer the papers to the associated CIT for further investigation
- advise the subcontractor’s processing office of the outcome confirming what credit can be given.