Revenue fines subbie for paying too much CIS tax

Grant Prior 14 years ago

A man who was fined by HM Revenue & Customs for paying too much tax was a trade contractor who had got his sums wrong under the CIS system.

The case hit the headlines earlier this month when the victim tried to reclaim £3,000 in overpaid tax for the year to 2009. HMRC said he was only owed £1,000 – and then fined him £1,400 for the mistake.

Accountants have now revealed the penalised taxpayer was a subcontractor from Kent who had simply got in a muddle with his CIS returns.

Tough new penalty regimes operated by HMRC mean the tax man can levy fines of up to 30% for ‘careless’ mistakes and between 30% and 70% in cases where taxpayers have been accused of being deliberately misleading.

The Kent subbie was hit with a 70% fine on the £2,000 difference between his claim and the actual rebate amount – even though HMRC still owed him money.

Law firm McGrigors, who are advising the man in his bid to have the fine over-turned, claimed HMRC is being heavy-handed and the discrepancy was a simple accounting mistake due to the fact that he filled-in his own self assessment

Phil Berwick, Director of Tax Investigations at McGrigors said:“Taxpayers will probably not be aware that HMRC have the ability to impose a penalty in these circumstances.  They will certainly be unaware that what appears to be a simple mistake can be treated so severely by HMRC.

“Despite being owed £1,000 from HMRC the taxpayer has been handed a fine for £1,400! Imposing a penalty like this is a gross over reaction and wholly disproportionate to the circumstances.

“Calculating a rebate can be complicated, and the taxpayer in question was unrepresented by an adviser, yet HMRC has refused to take any of this into consideration. We believe he made an honest mistake, so for HMRC to be fining him is completely outrageous.”

Latest news

Birmingham to pick five firms for £265m homes retrofit plan

Firms to be charged annual fee to cover Council cost of promoting energy efficiency
31 mins ago

Arup and Binnies to design Abingdon reservoir

Embankment trial will help consultants to draw up £1.5bn reservoir design
32 mins ago

Subdued market sees profit warning from SIG

Insulation and building products supplier pushes back timing for market turnaround
9 mins ago

Developer CLS to advance major new Vauxhall scheme

Citadel Place scheme will consist of 400 student rooms and 200 flats
28 mins ago

Tarmac trials electric tipper truck

Pioneering EV tipper being put through its paces
15 mins ago

Early bond release key to averting industry surety crisis

Contractors must put pressure on clients to release bonds promptly
3 days ago

Over 1000 building safety cladding retrofits completed

25% of safety retrofits finished seven years after Grenfell disaster
3 days ago

Steel import delays make Rangers miss kick-off

Construction work at Ibrox will not be finished by start of next season
4 days ago

Lidl looking for new contractors for store building plans

Sign up for events in Newcastle, Glasgow, Birmingham and Southampton
3 days ago

Utility firm GTC revs up for ground source heat pump era

Contractor and heat pump maker strikes ground-breaking deal
3 days ago

Amey switches kit supplier to Speedy from HSS

New plant and equipment hire deal worth £25m a year
4 days ago

Clients under spotlight after bond bombshell

Contractors call for action to avoid project delays
4 days ago

M&E specialist Lorne Stewart falls into the red

Parent group suffers £2.8m loss in face of cost inflation and insolvencies
4 days ago

Four men rushed to hospital after site accident

Eye-witnesses report a wall was knocked over on Edinburgh site
4 days ago

World’s tallest scissor lift set for UK sites

Hire Safe Solutions partners with Dingli to supply lift with working height of 37 metres
4 days ago

Barhale wins £36m East London sewer remediation

Northern Outfall Sewer in West Ham runs above railway lines in the city
4 days ago

Weston Homes thumbs-up for £220m Essex homes scheme

Colchester 600-home Viridis scheme gains outline consent
4 days ago

Balfour seals £192m deal for trio of Scottish substations

Work to start this summer to enhance electrical transmission in Argyll
5 days ago

Construction bond bombshell as major player quits market

QBE currently provides cover for 20 of the industry's 30 biggest contractors
5 days ago

United Utilities names another 18 winners for £2.7bn water spend

Water giant cuts out large management contractors in latest spending round
6 days ago

Green light for £130m Dundee Eden project

Former gasholder site to be transformed into green house
5 days ago

Four tower scheme in Glasgow gets green light

Go-ahead for major mixed-use scheme at Central Quay
5 days ago

‘Green collar’ construction workers earning £134,000

Cost consultant T&T says insulation and heat pump trades earning £70 an hour in London
5 days ago

£65m Trafford Waters resi blocks approved

X1 Developments plans over 200 homes in 13- and 8-storey blocks
5 days ago

Over 100 firms win £1.5bn ICN housing framework

Great Places Housing Group names key partners for new homes programme
6 days ago

Steelwork firm went down owing £4.5m to suppliers

Subcontractors left holding unpaid invoices from SH Structures
6 days ago

Scottish civils firm to buy stake in piling specialist

Advance Construction in talks for 25% stake in Northern Piling Ltd
6 days ago

RSK secures £500m for fresh acquisitions spree

Acquisitive group aims to buy another 200 businesses by 2030
6 days ago

Beal Homes gets green light for £105m Humber scheme

Work to start on more than 500 homes in North East Lincolnshire
6 days ago

RED wins £20m East London office refurb

Grade II listed Victorian building to be upgraded to Cat A offices
6 days ago

Contractor services