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Tax office gives a month's grace
00:00 14 Jul 1999
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Exclusive by Michael Gordon
The Inland Revenue (IR) has agreed to introduce transitional arrangements, lasting a month, to help ease the changeover to the new construction industry tax scheme next month.
An urgent meeting was held between the IR and major contractors last week following a survey of the Construction Confederation's biggest members which found that just 7 per cent of main contractors' suppliers had provided the tax details required before they can be paid under the scheme. Many have been slow to apply for the appropriate tax certificate, and others are still waiting for the IR to forward the appropriate documentation.
Since April more than 250,000 subcontractors have phoned the IR help-line (0845 3000581), and the contractor help-line (0345 335588) has received 41,000 calls.
If a contractor fails to inspect a subcontractor's Registration Card or Certificate, and fails to record payments on the appropriate voucher, it would be liable to a £3,000 penalty.
The transitional arrangements mean that contractors should send subcontractors, who do not have the correct documentation, to the nearest tax office to either complete an application form, or provide the office will sufficient detail to enable it to verify that a completed application has already been submitted.
The Tax Office will then immediately issue a temporary Tax Payment Card (CIS65) which will enable the contractor to make payment under deduction of tax while the application is processed.
The temporary tax card will only be valid until 5 September. The IR will not seek penalties where a contractor makes a payment in accordance with these transitional arrangements up to that date.
A spokeswoman for the Inland Revenue said: "We are considering what was proposed at the meeting but at the moment the legislation is as it stands. We received a number of suggestions from contractors which we are currently examining - any we feel appropriate will be taken on. We may change the way in which we accept documentation but we can't change the legislation."
The Inland Revenue (IR) has agreed to introduce transitional arrangements, lasting a month, to help ease the changeover to the new construction industry tax scheme next month.
An urgent meeting was held between the IR and major contractors last week following a survey of the Construction Confederation's biggest members which found that just 7 per cent of main contractors' suppliers had provided the tax details required before they can be paid under the scheme. Many have been slow to apply for the appropriate tax certificate, and others are still waiting for the IR to forward the appropriate documentation.
Since April more than 250,000 subcontractors have phoned the IR help-line (0845 3000581), and the contractor help-line (0345 335588) has received 41,000 calls.
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If a contractor fails to inspect a subcontractor's Registration Card or Certificate, and fails to record payments on the appropriate voucher, it would be liable to a £3,000 penalty.
The transitional arrangements mean that contractors should send subcontractors, who do not have the correct documentation, to the nearest tax office to either complete an application form, or provide the office will sufficient detail to enable it to verify that a completed application has already been submitted.
The Tax Office will then immediately issue a temporary Tax Payment Card (CIS65) which will enable the contractor to make payment under deduction of tax while the application is processed.
The temporary tax card will only be valid until 5 September. The IR will not seek penalties where a contractor makes a payment in accordance with these transitional arrangements up to that date.
A spokeswoman for the Inland Revenue said: "We are considering what was proposed at the meeting but at the moment the legislation is as it stands. We received a number of suggestions from contractors which we are currently examining - any we feel appropriate will be taken on. We may change the way in which we accept documentation but we can't change the legislation."
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