Construction Industry Scheme - CIS6300

Vouchers: cessations and surrender: introduction

CESSATIONS AND SURRENDER OF VOUCHERS: INTRODUCTION

This paragraph serves as an introductory overview of cessations and the surrender of vouchers; for deeper coverage use the above links to information or action guides.

This module explains what you should do where it becomes necessary to recover vouchers held by a subcontractor or contractor under the CIS system.

Vouchers are important documents which can be misused if they get into the wrong hands. Where the holder no longer needs vouchers that have been issued to him/her, there is always a risk that they may be disposed of carelessly or unlawfully. It is important, therefore, to make all reasonable efforts to recover unused vouchers to limit the scope for misuse.

The most common situation in which vouchers need to be recovered is where there is a cessation. The term cessation is used here to cover three kinds of event

• The cessation of trade of a sole trader, partnership or company which uses vouchers in the role of subcontractor.

• The cessation of a partner or director holding a certificate and vouchers on behalf of a concern.

• The cessation of a contractor using CIS23 and/or CIS25 vouchers.

Other situations in which vouchers need to be recovered are where

• a CIS6 certificate is formally cancelled,

• the name of a CIS6 user, or a concern s/he holds a certificate on behalf of, changes, requiring the issue of a fresh certificate and vouchers.

CIS24 VOUCHERS HELD AFTER EXPIRY OF CIS6 CERTIFICATE

Vouchers remaining in the possession of a CIS6 holder after the certificate has expired (and not been renewed) do not require any special action to recover them.

The voucher replenishment system progressively reduces the number of CIS24 vouchers issued as the expiry date approaches. The number of vouchers left in the user's hands at expiry should be limited. If the vouchers are used to vouch payments made after the expiry date, this will be detected by the CIS system and an exception report will be generated.

CESSATION FEATURES NOT COVERED IN THIS MODULE

Cessations of business or of cardholders to act on behalf of businesses have consequences for the Construction Industry Scheme beyond the return of unused vouchers.

There are also issues around the following areas which are dealt with as listed below

• Cessations and Certificates- CIS3800

• Closing contractor schemes- CIS4356

• Cessations and Registration Cards- CIS2700

When writing to a voucher user for surrender of unused vouchers you should also deal with the other aspects mentioned above where appropriate.

In some cases the holder of vouchers may not respond to requests for their surrender. Often, this goes together with a failure to surrender a matching certificate. If this occurs formal cancellation of the certificate becomes necessary and is covered in the module at CIS3700.

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