CC warns firms to pay CIS returns on time

The Construction Confederation (CC) has warned contractors that they risk losing their gross payment status if they do not submit their monthly returns on time.

The caution comes nearly a month after CJ revealed that 12,000 firms have had their payment status revoked since the new CIS scheme began.

There were 107,000 contractors with gross payment status when the new taxation system was introduced in April 2007.

CC director of tax Liz Bridge said: “The consequences for contractors who fall foul of the HMRC and find themselves losing their gross payment status can be catastrophic. At best it is very embarrassing and very inconvenient. At its  worst the imposition of monthly payment of the tax at the provisional rate of 20% can have severe financial implications.

“Too many contractors are waiting for ‘final warning’ notices from HMRC before making their returns. This is a very dangerous game to play and should be avoided at all costs. We have main contractors, long-established and respected companies, moving from gross to net.”