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Taxman calls for teamwork

Contractors told they are key to ensuring swift and problem-free introduction of delayed tax regime shake-up next April

THE MAN in charge of the biggest tax shake-up in recent years has called on contractors to make sure the stalled scheme gets off to a smooth start.

HM Revenue & Customs director Doug Tweddle said the Revenue was doing all it could to make sure next April's launch goes well.

But he said the onus was on contractors to ensure the new CIS scheme was made to work as quickly as possible.

He added: 'Inevitably there will be some teething problems but we are developing an extensive range of support seminars and events in the next six months.

'We are doing everything we reasonably can but it's going to have to be the industry which responds to that.'

The scheme was supposed to have been introduced in April this year but the Revenue decided to postpone it 12 months after the industry said the introduction was being rushed.

Mr Tweddle said the launch of the new scheme, which the Revenue estimates will reduce the costs of compliance from £52 million to £30 million, will not be postponed again.

The reforms are expected to rake in an extra £180 million a year when they come into effect and Treasury minister John Healy has repeatedly said he will not stomach another delay.

Mr Tweddle said: 'This is not going to be postponed again. This is going to happen next year. The minister has made it very clear he wants the industry to be ready for this.'

Tax chiefs believe around 5 per cent of subcontractors are wrongly being paid gross of tax and are trying to get them to switch to the basic rate.

Mr Tweddle confirmed that the Revenue would not impose automatic fixed penalties for companies making incorrect declarations about employment status or ver if icat ion.

But he warned: 'This is not a blank cheque to do nothing. We will be making compliance checks in the first six months and gross status may be at risk.'

The CIS helpline can be contacted on 0845 366 7899 or at www. hmrc.gov. uk/new-cis.