United Kingdom
11 February 2011 - Bad advice not a reasonable excuse
In a recent First Tier Tribunal case concerning the late submission of Construction Industry Scheme (CIS) monthly returns, the Tribunal held that bad advice from a former adviser was not a reasonable excuse for the late submission of the returns.
The taxpayer engaged new advisers, who assisted with the submission of the returns, but HMRC charged statutory penalties amounting to £9,300. The taxpayer argued that this was excessive, as there had been no loss of tax revenue, but the Tribunal stated that it had no discretion in such circumstances.
It should be noted that a new tax-geared penalty regime will commence in October 2011, and HMRC will allow CIS contractors who have been charged a penalty under the current regime to request that it be replaced with a charge under the new regime, where this would be lower.
Please contact Alison Hawkes to discuss penalties or any other CIS matter.