In CJS Eastern v HMRC [2015] UKFTT 213 (13 May 2015) the FTT found that reasonable excuse was not established and that fixed penalties should be upheld but that a variable penalty should be set aside.
CJS provided lightning protection. It had engaged Hudson a company which claimed that it would undertake all construction industry scheme (CIS) requirements. HMRC later on contacted CJS explaining that Hudson was ‘net’ for CIS purposes and that CJS should have continued to deduct and pay 20% tax. HMRC imposed penalties totalling £81 000 (including £56 500 ‘month 13’ penalties).
The FTT accepted that Mr Sanders director at CJS had held a genuine belief that the company’s CIS responsibilities were taken care of. It was also reasonable to engage a firm such as Hudson. However it was not reasonable for Mr Sanders not to have sought advice from a...
