Access Contracting Services Ltd v Revenue And Customs (CIS Penalties) [2023] UKFTT 973 (TC) (06 November 2023)

Access Contracting Services Ltd v Revenue And Customs (CIS Penalties) [2023] UKFTT 973 (TC) (06 November 2023)

The appellant did not take reasonable care to comply with CIS legislation as there were no adequate checks or controls over the compliance process, especially given the significant risks and size of payments involved. Reliance on a single employee without oversight or verification was insufficient. Therefore, Condition A of Regulation 9(3) was not satisfied and relief under Regulation 9(5) was not appropriate.

Citation
[2023] UKFTT 973 (TC)
Parties
Appellant: Access Contracting Services Ltd; Respondents: The Commissioners for His Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
06 November 2023
Procedural Posture
Tax Appeal (first Tier Tribunal) / Judgment After Remote Hearing
Outcome
Appeal dismissed
Legal Topics
Construction Industry Scheme (cis), Reasonable Care Standard, Penalty Assessment, Employer Compliance, Delegation of Compliance Duties
Tax Law Construction Industry Scheme (cis) Reasonable Care Standard Penalty Assessment Employer Compliance Delegation of Compliance Duties

Case Brief

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Parties

Access Contracting Services Ltd

Appellant

The Commissioners for His Majesty’s Revenue and Customs

Respondents

Procedural Posture

Tax Appeal (first Tier Tribunal) / Judgment After Remote Hearing

Legal Issues

  1. 1 Whether the appellant took reasonable care to comply with CIS legislation under Regulation 9(3) of the Income Tax (Construction Industry Scheme) Regulations 2005
  2. 2 Whether an error was made in good faith or there was a genuine belief that section 61 did not apply
  3. 3 Whether special circumstances exist to warrant penalty reduction

Ratio Decidendi

The appellant did not take reasonable care to comply with CIS legislation as there were no adequate checks or controls over the compliance process, especially given the significant risks and size of payments involved. Reliance on a single employee without oversight or verification was insufficient. Therefore, Condition A of Regulation 9(3) was not satisfied and relief under Regulation 9(5) was not appropriate.

Court Disposition

Appeal dismissed

Orders

  • No direction under Regulation 9(5) to relieve liability; HMRC's refusal upheld.
  • No special reduction in penalty warranted.