Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to the newest version of your browser.

Your browser appears to have cookies disabled. For the best experience of Construction News, please enable cookies in your browser.

Welcome to the Construction News site. As we have relaunched, you will have to sign in once now and agree for us to use cookies, so you won't need to log in each time you visit our site.
Learn more

Unions run rule over Revenue's tax scheme

TGWU and Ucatt claim it will be impossible to check if firms are properly categorising workers

UNION leaders are casting doubt about Inland Revenue plans to overhaul the construction industry tax scheme by forcing contractors to check workers' employment status.

Bosses from Ucatt and transport union TGWU said a verification service as part of the CIS would not work because the Revenue would be unable to police it.

Self-employed workers currently providing a contractor with a CIS4 or CIS6 certificate are paid gross of tax.

But the Revenue's CIS consultation document proposes to place the onus on contractors to determine if workers are employed or selfemployed.

Firms incorrectly categorising a worker will face claims for back tax with interest and penalties.

Bob Blackman, construction secretary of transport union TGWU, said: 'I have grave doubts about the ability of the Revenue or trade unions to police the verification scheme.

'Unions have repeatedly called for tax inspectors to prosecute major offenders but cases often fail because the Revenue has claimed cast-iron evidence has been difficult to secure.

Ucatt general secretary George Brumwell said: 'We agree with the verification system in principle but we want to see an overhaul of the Revenue's construction compliance division to ensure firms are acutely aware that failure to categorise workers correctly will lead to fines.'

A Construction Confederation spokesman said the move would be 'impractical and unworkable' because of the sheer number of checks that would be required.

The Inland Revenue denied it would be hard to police the scheme.

CIS policy head John Hinton said: 'This is about the industry taking responsibility for its actions.'

The unions' proposals TGWU proposals:

Major overhaul of the way labour is organised in the industry

All workers directly employed on Government projects

Workers in the contractor/subcontractor chain to have full employment rights and national rule agreements to have force of law

Ucatt proposals:

DTI to work with Inland Revenue in tackling false self-employment

Legal duty placed on clients to ensure contractors implement system

Tax inspectors to carry out site blitzes

Increased resources for the Revenue's compliance division

All workers directly employed on Government projects