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21 September 2015
N Barrett (TC4514)
The taxpayer was a jobbing builder. He employed an accountant to deal with his business’s PAYE. During the years 2006/07 to 2010/11 he failed to make construction industry scheme deductions to subcontractors’ pay or submit returns. HMRC issued determinations under the Income Tax (Construction Industry Scheme) Regulations 2005/2045 regulation 13. They also imposed penalties of £40 332 under TMA 1970 s 98A(2)(a) for late returns.
The taxpayer appealed. The department offered to mitigate the penalties under s 102 to £3 196 and confirmed that the offer would remain if the appeal was decided against the taxpayer.
The taxpayer claimed reasonable excuse for the failures. He had appointed an accountant to organise all relevant filings and provide advice. He had no reason to believe the adviser would not carry out the services properly.
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