Debt and return pursuit: miscellaneous charges: Regulation 13 determinations: general
The legislation that covers Regulation 13 can be seen at CISR17140.
SI2005/2045 regulation 13(2) permits an Officer of the Revenue and Customs to raise a determination on a contractor to cover deductions the Officer has reason to believe should have been made.
FA2004/S61 (1) requires an Officer to be satisfied that all such deductions and payments are being made under deduction.
Regulation 13 determinations are used mainly where:
- a contractor has failed to make deductions under the Construction Industry Scheme
- an Officer has reason to believe that the amount the contractor is liable to pay is greater than the amount, if any, which has been paid
- there has been no claim made under Regulation 9(5), Regulation 9(3) or Regulation 9(4), that the contractor is not liable to pay the amounts under-deducted
- a contractor disputes liability
- attempts to agree a contract settlement have failed or
- a contractor fails to submit monthly returns
- contractor and subcontractor disagree on whether a payment falls within the scope of the scheme.
Employer Compliance will issue a warning letter to the contractor explaining why a Regulation 13 determination will be issued.
SAFE system will:
- issue the first reminder letter 15 days after the due date
- issue the second reminder letter 14 days after the first reminder has been issued
- move the work item to the Local Action Work list 10 days after the second reminder was issued.
Note: Regulation 13 determinations do not flow across to IDMS and you should not try to pseudo on to IDMS.
More background information can be found in the CISR manual at CISR82010.
Due date for payment
The provisions of Parts IV, V and VI, TMA70 apply to determinations made under Regulation 13(2) and to appeals, collection and recovery of the amounts charged. The amount charged is due and payable 14 days after the determination is made.
Interest is chargeable under Regulation 14 on subcontractor deductions that are outstanding at the end of the tax year.
This regulation deals with interest payments on overdue amounts and should be applied if the contractor has not paid over to HMRC the total amount due in respect of the tax year by the reckonable date: SI2005/2045 reg. 14(1).
Any amounts still outstanding from the contractor at the reckonable date will be subject to interest at the prescribed rate: SI2005/2045 reg. 14(2).
The ‘reckonable date’ is 17 days after the end of the tax year, if payment is made electronically, or 14 days after the end of the tax year in any other case: SI2005/2045 reg 14(7).
The reckonable date for interest is therefore the 19 April following the end of the tax year for non electronic payments and 22 April for payments made electronically.
Interest is chargeable at the same rate as late payments of income tax.
Accrued interest is shown on each reminder issued by SAFE. When payment is made SAFE will recalculate the interest due. If the difference is £32 or less SAFE will raise a charge to the value of the interest paid, otherwise it will raise a charge for the amount calculated.