Construction Industry Scheme Operational Forum (CISOF) - Minutes

Meeting on Wednesday 24 June 2009, 1 Horse Guards Road, London

Attendees:

HMRC

Ray Bourley [RB] (Chair)
Ken Claydon [KC]
Jeremy Croucher [JC]
Terry Dummett [TD]
Caroline Elvin [CE]
Gordon Martin [GM]

Industry

Liz Bridge [LB] (JTC)
Eric Rolfe [ER] (JTC)
Maurice Denyer [MD] (FMB)
Howard Royse [HR] (ICAEW)
Sue Cave [SC] (FSB)
Steve Crawte [SCe] (NSCC)
Glenn Collins [GC] (ACCA)
George Northall [GN] (CBI)
Stephen Burrell [SB] (CIOT)
Jim Etherton [JE] (BASD)
Ben Webb [BW] (CBI)

Apologies

Ken Tracey (ECA)
Gordon Marjoram (GM) (FMB)
George Northall
Suzannah Nichol
Elaine Gibson

1. HMRC Debt Management & Banking (DMB) issues

Caroline Elvin gave a presentation on the current DMB pursuit processes, with a particular emphasis on CIS penalties.

View the handouts (PDF 40K).

Industry representatives expressed specific interest in future DMB campaign based activity. Caroline agreed to let CISOF members have details of where they can find out more about this. (Post-minute note: DMB’s campaigns strategy is in its early stages and work has just commenced on an information pack for customers which will outline Campaign principles.)

Caroline also agreed to provide some statistics on the DMB success rate in tracing new addresses for RLS items. (Post-minute note: In 2008-09, for employer/contractors 92.6% were traced.)

2. Minutes of last meeting (25 February 2009) and action points

SB asked that that the minutes reflect the industry’s vote of thanks to Roy Massingale for his chairing of the forum over the past year

  • Action point 1 - KC had taken an action to establish whether the CIS helpline could provide call reference numbers. This is not possible for CIS but on-line contact history provides details of previous calls at later times.

    Access to recorded telephone conversations is very straightforward. All that is needed is a UTR and an approximate date and time of call.

    KC undertook to establish how long digitally recorded calls are retained for. (Post-minute note: all recordings are retained for six years.)

  • Action point 2 - (see (1) above). Action closed.

  • Action point 3 - (see HMRC issues (CIS stats) below). Action closed.

    KC advised that the e-filing problem with input dates – the month a contractor enters being shown in terms of the ‘month commencing’ as opposed to the ‘month ending’ – can apparently be resolved easily and inexpensively. KC undertook to confirm when this solution would be put in place. (Post-minute note: this will be included in the enhancement release scheduled for 23 November 2009.)

3. HMRC Issues

(a) CIS statistics - RB, referring to pages 7 to 14 of the information packs observed that

  • the e-filing take-up rate was still gradually increasing (a campaign run by the CIS helpline to encourage e-filing has been particularly successful), and
  • that on- line verification contact is now on par with telephone requests

KC agreed to establish what statistics could be provided to show the level of paper returns still being made. (Post-minute note: this data is already part of the statistical pack, at the top of page 8 of the pack produced for the most recent meeting. This chart shows that 117k paper returns were made in May 2007 (out of a total of 190k returns), representing 62% of the total for that month. By May 2009, paper returns amounted to 77k (out of a total of 155k returns) which was exactly 50% of the total.)

Industry requested that future information packs include CIS helpline statistics.

(b) TTQT - RB circulated for comment and discussion the latest TTQT update figures.

 

November 2008

June 2009

TTQT

    

Fully reviewed

82,563

135,794

Failed

24,547

24,547

Awaiting review

4,720

3,768

% fails after full review

30%

30.4%

 

 

 

TTQT appeals

    

Total

13,850

20,901

Allowed

9,891

17,182

Under review

2,777

1,724

Withdrawn

421

840

Invited to withdraw

436

411

Listed/referred to Tribunal

85

51

Awaiting listing/ Tribunal

116

149

Subcontractor won

40

234

Subcontractor lost

81

310

 

    

Fails post-appeals

    

Fails after appeals

11,199

21,298

% fails after appeal

14%

15.7%
  • TTQT process will be fully automated from November 2009. This will eradicate the ‘awaiting review’ figures

RB, addressing Action Point #3 (see (2) above), provided a breakdown of TTQT failures by business size. Industry asked for the figures to include the percentages within each population.

View the revised table (PDF 18K)

(c) Scope Review - The consensus of opinion with regard to Carpet Fitting is to leave matters as they are. GM said he would provide details of the amendments to scope which had been agreed during the review.

View the Scope changes document (PDF 35K)

(e) Tribunals Reform - JC provided an update to the Tribunals Reform process

  • Tribunals Reform went live on 1 April
  • Upper Tribunal and First Tier tax chamber implemented bringing together the four pre-1 April tribunals for the full range of direct and indirect taxes
  • Four appeal tracks – Paper, Basic, Standard & Complex
  • All CIS penalty appeals default automatically to ‘paper track’ (with an option to request an oral hearing available to all parties to an appeal)
  • Most decisions on GPS applications/withdrawals will default to the ‘basic oral hearing track’ (but all parties to an appeal can request a different oral hearing track if appropriate. Final decision lies with the Tribunal)
  • Decision maker process now in place
  • Independent Appeal Review Units (ARUs) now in place. Londonderry ARU have responsibility for all SA CIS GPS appeals (refusal and withdrawal) and all appeals against penalties for late-filed contractor monthly returns
  • ARUs for local compliance are attached to each of the 5 national Appeals Units. All CT CIS GPS appeals (refusal and withdrawal) will be referred to local compliance ARUs.
  • Review officers are independent and outside of the management chain for Decision Makers.
  • Reviews need to be completed within 45 days for appeals made after 1 April, or 90 days for appeals made earlier and for which a review is requested before 31 March 2010. Longer review periods can also be agreed by negotiation with parties to an appeal.
  • A pdf version of the independent reviewer learning material is now available on the HMRC website.
  • Once an appeal has been made to HMRC, one can also be made at any time to the Tribunal Service except when an independent review is running.
  • Stats relating to the numbers of CIS appeals which have been referred for independent review, review outcomes, appeals referred to Tribunal and Tribunal outcomes etc have been requested. RB said he would send these to Industry representatives when available. (Post-minute note: At present, limited stats are available. We will try to provide a better picture by the September meeting. Figures for SA cases are a total of 196 requests for reviews, of which 41 were agreed, 114 were rejected and one withdrawn. The remainder are still under consideration.)

4. Industry Schemes

(a) Appeals to New Tribunals [LB] (see 3(d) above)

(b) Correcting errors on returns [LB]. Is it possible to correct an error on a return by sending in a new one?

It is but only under circumstances where it is agreed by both HMRC and the contractor that this is the best option. HMRC will make the necessary arrangements on application by the contractor. Unsolicited new returns would displace the filing date of the original return and lead to penalties being issued. Guidance on the completion of forms for amending returns is ready. Publication will need to coincide with the next update of the CIS340. When it is, the guidance will be posted to the external CIS website.

c) Help on the e-verification window [ER]. KC has made representations to the HMRC on-line service people and will advise further when a solution to the current problem is put in place.

(d) Managing Agents [SB]. RB said that guidance had been provided previously on this and will arrange for this to be added to the external CIS website.

(e) Agents and CIS details (forms 64-8) [SB]. There seem to be problems in extending the authority provided by a form 64-8 to cover CIS. The form itself has no check-box to tick for CIS output etc. Currently a separate letter of authority is needed. KC agreed to look into this. (Update: the people responsible for the form 64-8 tell us they are not aware of any clamour by agents for CIS to be included on the form. However, the 64-8 is to be revised later this year and we have been invited to participate in discussions around the revision.)

5. AOB

  • JC advised that all CT CIS matters have now been centralised in Hull. This means that the greater majority of CIS processing work is now undertaken in two main centres – Newry and Hull
  • RB advised that a MORI poll on New CIS had recently been commissioned which will be conducted over the next 7-8 weeks. The poll is completely anonymous and is targeted at both subcontractors and contractors alike. Questions asked will concentrate on what they think about the new scheme and how it works.
  • Next CISOF meeting will be on Wednesday 23rd September 2009.