Third party excuse

The taxpayer company appealed against the cancellation of its registration for gross payment status under the construction industry scheme.

The company had been set up in 2006 by V who explained that he had no knowledge of tax and wanted it dealt with properly.

He therefore entered into an agreement with a business contact giving him a 50% interest in the company in return for the use of business premises and someone who become his company secretary to look after the company’s tax affairs.

V believed that as a result the company’s tax obligations were up to date.

However this was not the case and in April 2008 the company was presented with a demand for £1 600 for penalties for late submission of returns.

This V paid and afterwards arranged for an external accountant to check the position.

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