Tax man cuts fines for late CIS returns

Grant Prior 13 years ago
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HM Revenue & Customs is imposing an upper limit on fines for late CIS tax returns.

The move could benefit thousands of contractors who are hit with penalties each year for falling behind with their monthly returns under the scheme.

Contractors are currently fined a minimum of £100 for a tax return not filed by the due date of the 19th of the month and a further £100 for every month their submissions are late.

After a year contractors can be hit with additional fines of up to £3,000.

Fines also increase depending on the number of subcontractors on a firm’s books with penalties quickly approaching the £10,000 mark.

The new regime will come into force next October and will limit annual fines to £3,000 for contractors filing their first set of returns.

HMRC said: “In many cases, the new penalties will be less than what would be charged now.”

One tax adviser told the Enquirer: “This is good news for most contractors because the current fine system has got out of hand with firms being hit with a barrage of penalties.”

For examples of how the new regime will affect you click here

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