10 November 2008: Withdrawal of gross payment status causing mayhem within the construction industry

Withdrawal of gross payment status is causing mayhem within the construction industry. Avoid being a victim.

Construction Industry Scheme (CIS)

The Scheduled Review

Tax Treatment Qualification Test (TTQT)

HM Revenue & Customs (HMRC) are conducting automated compliance checks against subconstractors who hold gross payment status. They will look at every gross payment subcontractor over a rolling period of 12 months.

They will look at the compliance history for the period of 12 months to the review date to see that you/your company (and any partners if you are a partnership) have complied with your obligations as not only an employer and/or contractor but also your personal obligations as a taxpayer.

Failures resulting in automatic withdrawal of gross payment status and where HMRC has received:

1. Your monthly CIS return late on four or more occasions

2. One of your monthly CIS returns more than 28 days late

3. Your CIS/PAYE deductions late on four or more occasions

4. One of your CIS/PAYE deductions more than 14 days late

5. One payment of self assessment tax more than 28 days late

6. One payment of corporation tax more than 28 days late

You will also fail if at the date of review, you still have outstanding an overdue form P35 or Self Assessment return.

If you would like further information or advice on this issue or other CIS related matters, please contact Dawn Foden-Smith.