CISR65650 - Late Return Automatic Penalties: Vacating a Penalty

| CISR65000 | Information contents | |—————————————————————————————————–|———————-|

This action guide outlines how to vacate a CIS penalty you should hold one of the CISR Penalty Administrator or CISR Process Manager roles.

  • From the CIS Main Menu window you should select the required contractor scheme and then ‘Vacate Penalty’.

You will then be taken to the ‘Automatic Late Filing Penalties’ window. Within this window are two panels, the upper panel lists the scheme name and AO reference and Selected Period’ which at this stage remains unpopulated. The lower panel titled ‘Return periods’ lists all return periods up to and including the most recent month to the 5th that has passed.

In the ‘Return periods’ panel the following headings appear;

  • Return period - this displays the month and year for the Monthly return
  • Filing dates missed - this will be the number of penalty dates that have passed without the CIS Monthly return being filed. For CIS penalties issued under TMA70/S98A this could have been up to a maximum of 13 penalty dates, for CIS penalties issued under FA09/SCH55 this will be a maximum of 4 penalty dates.
  • Penalties due - this will be the number of penalties due to be issued where either a penalty inhibition has not been set or a period of ‘Inactivity’ has not been set for the month concerned.
  • Reason for no penalties - this will show you the reason where no CIS penalties have been raised for that month the possible options here are;
  • Return received on time
  • Pending - this will display where a filing date has been missed and CIS is to issue a penalty, but the monthly penalty run has not yet occurred.
  • Inhibited (where a penalty inhibition has been set or the penalty is ‘Withheld’)
  • Vacated, Inactive (where all the CIS penalties have been vacated for a period when the contractor was ‘Inactive’ or had ceased as a contractor)

  • Vacated (where all the CIS penalties have been vacated)

  • Select one of the return periods displayed in the ‘Return periods’ panel

Details of all CIS penalties charged for that month will now be displayed in the ‘Automatic Late Filing Penalties’ panel above, in addition the Selected period has now been populated with the month and year that you selected above.

A maximum of 5 CIS penalties are displayed for the month selected where there are more than 5 penalties then these will be arranged on separate pages. From 29th October 2011 this panel could be populated with both CIS penalties issued under TMA70/S98A and FA09/SCH55.

Where there are no penalties for the month you have selected or all of the CIS penalties have already been vacated or reduced to nil following a successful appeal the message ‘There are no penalties to be vacated for the selected period’ will be displayed.

The ‘Automatic Late Filing Penalties’ panel will now be populated with the following information;

  • Reference - this will be the SAFE reference attached to the penalty
  • Type - indicates the type of penalty, entries being;
  • for penalties issued under TMA70/S98A , late filing or final late filing
  • for penalties issued under FA09/SCH55 this will be FP1, FP2, TGP1, or TGP2 (see CISR65050).
  • Return period - this displays the Monthly return period the penalty relates to
  • Instance - the first 2 digits (outside the brackets) relate to the penalty instance for that return. The filing date to which this penalty relates will then follow. For example, 01 (19 08 2008) would be the first penalty instance relating to the monthly return ended 05/08/08 due to be submitted to HMRC by 19/08/08. This will appear for CIS penalties issued under TMA70/S98A from 29th October 2011 this field will remain empty for CIS penalties issued under FA09/SCH55.
  • Issued Date - this will be the date of issue or the date of the last amendment of the CIS penalty.
  • Amount - is the current amount of the CIS penalty charged
  • Status - this is the current status of the penalty and will be issued, reissued, or withheld
  • Appeal Progress - displays the current state of any appeal made against the penalty.

Identify the CIS penalty or penalties to be vacated;

  • select the check-box to the left of each the penalties you wish to vacate.

From the drop-down menu to the right of ‘Reason’

  • select the reason for vacating the penalty, the options are
  • No longer in CIS
  • Incorrect Start Date
  • Period of Inactivity not recognised
  • Other.
  • Select the [Vacate] button.

An advisory message will display, ‘This will vacate the entries selected and update the table below’ if you wish to proceed;

  • selecting the [OK] button within the message

The CIS penalties will then be deleted from the ‘Automatic Late Filing Penalties’ panel and the ‘Return periods’ panel will be updated to show the CIS penalties now vacated. CISR will then notify SAFE of the reduction of the CIS penalties but this will only occur where the penalty had a status of ‘Issued’, at the same time a notification is also sent to the contractor of the reduction to the penalty (form SAFE6). If the state of the penalty was ‘Withheld’ no notification will be sent to SAFE as the original penalty charge would not have sent to SAFE.

CISR will then update the outbound ‘Contact History’ to show the CIS penalty or penalties that have been vacated.

You should then check whether any penalty inhibitions need to be set against future penalty dates for this return to prevent new CIS penalties from being issued, see CISR65090 for further information on when to set Penalty Inhibitions. You may also need to consider setting a Return Exemption (see CISR69050) where a return does not actually require completion for the month(s) concerned.