CIS - proposed changes cause concern

Andrew Scrivens of business advisers, IRPC Taxation Services, has submitted a letter to UKTECH outlining his concerns about the proposed changes to the Construction Industry Scheme.

Andrew Scrivens writes:

"As a consultant at IRPC Taxation Services, the proposed changes to the Construction Industry Scheme have been causing me grave concerns, and these have been compounded by letters recently sent out by the Inland Revenue (IR) to contractors and sub-contractors.

"The letter to contractors advises that the Revenue can help clarify the employment status of workers and urges those contractors wishing to check to contact the IR.

"However, what they don't point out is that local IR offices have been informed by Head Office that in all cases where the employment status is incorrect, they ought to seek arrears going back six years. This seems to be the case even where the contractor seeks clarification from the Revenue as a result of this letter.

"I believe strongly that this should have been clearly highlighted in the correspondence, to allow contractors to make a considered judgement about what to do.

"I am also dubious about the letter the IR has issued to sub-contractors extolling the virtues of being an employee. There is already evidence that rather than talking to the contractor, as suggested in the letter, some sub-contractors are seeking legal advice with a view to taking the contractor to an Industrial Tribunal. Surely not a healthy situation for anyone involved.

"Despite the fact that the IR's aim should be to help contractors, employees and sub-contractors through what is likely to be a difficult period of transition, it appears to me that instead the Revenue looks set to create even more confusion, not to mention contention, on the matter."