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Arghhhhhh!!!!

We submitted a SA100 several weeks ago and requested a refund of CIS tax on the return.

No refund!

HMRC Online site shows refund available for repayment. We request the overpayment to be refunded.

No refund!

Ring HMRC who say they will refund the overpayment.

No refund!

Client needs the money and thinks we are doing nothing so they ring HMRC themselves.

HMRC say they cannot issue refund without the CIS vouchers????? HMRC informs our client that their accountants should know that!!!!! Client calls us complaining bitterly that we haven't done our job right because we haven't sent the vouchers! What vouchers? This is a 2009/10 return! We tell client HMRC are mistaken, but we are not believed. HMRC are never wrong, are they?

Bangs head on wall and decides it is time I retired!

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24th Aug 2010 09:49

HMRC refund

For your client to request a refund of tax paid under CIS this would be calculated from the CIS certificates supplied by their customers who have deducted the tax. HMRC insist on the receipt of the original certificates before they pay refunds.

Where are the certificates?

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By neileg
24th Aug 2010 09:57

Not the whole story though?

Although CIS vouchers have been scrapped, the contractor is obliged to provide a monthly statement that shows the payments and deuctions for each month to the subcontractor. Surely your client has these?

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24th Aug 2010 10:02

Update

We are knowledgeable about CIS and HMRC specifically said vouchers. We suspected the hold up to be due to 'security checks', but no-one at HMRC admitted this.

Telephoned them this morning, they say whoever spoke to our client 'made it up', and have now decided to inform us the delay is due to 'possible' old NIC arrears and requires a 5 day turnaround. It is weeks since we originally requested the refund and previous calls to HMRC did not warn us of any delay, they just said it would be refunded immediately.

Thanks HMRC, for telling our client we haven't done our job right, when in reality you were the incompetent ones!

Spoke to our client who says there were NIC arrears many years ago, but these were settled. I will wait with bated breath to see if refund received !

 

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24th Aug 2010 10:05

HMRC playing games

You don't need to provide certificates under the current CIS rules (maybe under the old one's where there was actually a Revenue approved certificate issued...CIS24/25 - whichever one it is).  I certainly haven't been requested for the respective sub-contract certificates (unless under investigation), anyway the Revenue already have these details and should be able to check themselves.

Get back onto them and speak to someone in a senior position....get them to request the relevant information in writing if necessary - it may make them think a little more....but don't hold your breath.

 

 

 

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24th Aug 2010 10:07

I hope

you are printing out this stream and sending it to your client as proof of HMRC's deviousness 

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24th Aug 2010 10:09

Typical HMRC incompetence

We had this problem.

HMRC requested "certificates".   Three times we supplied copies of the monthly statement. Three times HMRC "lost" them. 

We have now commenced proceedings in the County Court to recover our client's tax, and to recover our costs plus damages for the distress caused to our client. So far HMRC have failed to file a defence (perhaps they have "lost" the summons too). Next week we will be requesting summary judgement and instructing bailiffs.

 

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24th Aug 2010 10:14

HMRC CIS refund

The next HMRC trick is to state that although the refund has been approved "it has been sent for further checks to Bristol".

"Bristol" seems to be a large pot of tax refunds held by HMRC to balance the government's books

It has no external phone and can only be contacted internally by e-mail. Refunds can take years if you fall into it's greedy maw.

Good luck

 

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By bobhurn
24th Aug 2010 11:22

HMRC Final trick

If they client makes a complaint HMRC will then tell them that the wrong bank details were entered on the atx return and when you take issue with them, they will deny ever having said it.  There was a time when those representing the Crown did so with integrity, I must be getting old

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By SteveOH
24th Aug 2010 11:26

To C_D

Please let us all know how you get on next week. If it works I'm sure that many more of us will be following your example. I did read on AWeb some time ago that it wasn't possible to sue HMRC. I hope I was wrong. I have read on here that on many occasions, where HMRC have sued a client for non payment of tax, the County Court judge has come down heavily against HMRC for various reasons.

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24th Aug 2010 11:48

To C-D

If you succeed HMRC will appeal it all the way up to the Supreme Court "in the national interest"

The whole forum is now agog to hear the result Do let us know

 

Good luck

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24th Aug 2010 12:04

HMRC CAN be sued even though they will try to tell you they cant

 

This was covered by Aweb -

http://www.accountingweb.co.uk/item/174902

 

 

and the relevent case is -

http://www.bailii.org/ew/cases/EWCA/Civ/2007/1041.html

 

Regardless of the above, HMRC are not above the law even if they like to think they are. From personal experience I can tell you that the best route is via small claims (depending on amounts involved) as HMRC tend to send someone from the local office to defend these actions.  Invariably they have little legal knowledge, display an arrogant attitude, and "wind up" the judge, making your job as the reasonable applicant simply seeking justice incredibly easy.

Just watch a glazed look come over the judge's face as he listens to the HMRC representative drone on and on about piffling "rules" which have no legal standing.  I've seen judges almost lose the will to live after listening to tax inspectors go on and on and on ........   without once actually addressing the points in issue. 

And if you fancy a bit of "sport" and are facing a female tax inspector, call her "love" or "petal" or some similar term and just watch her hackles rise as her politically correct indoctrination kicks in and she starts accusing you of all sorts of "isms".

 

 

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24th Aug 2010 12:11

@ bernard

If you succeed HMRC will appeal it all the way up to the Supreme Court "in the national interest"

The whole forum is now agog to hear the result Do let us know

Posted by bernard michael... on Tue, 24/08/2010 - 11:48

 

 

I doubt it - they havent on the other cases we have won.  

Also, before an appeal being allowed they have to pursuade the court that they have reasonable grounds for that appeal. Contrary to commom misconception, you cant appeal just because you dont like the original ruling. You need some legal basis for that appeal, either new evidence that not only didnt but couldnt have come out in the original hearing, or, some error in law made at the original hearing.  Otherwise your appeal will simply be rejected. 

Now where HMRC owe a taxpayer money, admit that they owe it, can be proven to owe it, and have no excuse other than incompetence for not paying it, what possible grounds can they have for an appeal and what "national interest" can they claim - unless of course they consider it in the "national interest" to illegally steal from taxpayers? 

  

 

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25th Aug 2010 13:35

Refunds

 Not sure whether this is still relevant but it will provide a bit of light relief anyway.

A few weeks ago there was a news item re our dear friends at HM. Apparently they had sent a retired lady a repayment by cheque. Unfortunately, instead of the £1,500+ she was due they had sent a cheque for £1,500,00.00+ (yes that is right 1.5 million). Fortunately dear old lady (not that old an old lady) was wise enough to realise that the payment they had sent was not due so had not cashed the cheque. What she did want was to keep the cheque as she thought it would be good for a few laughs in the future. She has apparently refused to hand the cheque back as she wants to frame and use it as a talking point over coffee or to cheer herself up when down - who can blame her? Obviously she would not have realised the knock on consequences.

As I understand it HM cheques cannot be cancelled and I believe it is the same with Bank or Building Society counter cheques as well - just cannot remember the exact reasons but I can understand the logic. 

During the news article I think someone suggested that whilst that cheque is in date (it was 2-3 months ago so 3-4 months to go) it would limit HM's ability to make other repayments. Maybe this is the problem.

I have seen clients have very small repayments but have one client waiting for £18,000 and they are getting desperate for it. Same old from HM to client but fortunately a very long standing client and a good friend. phew. It will be good to send a copy of the above posts though to back my version of the story up!

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25th Aug 2010 13:53

Thanks for the comments, everyone

Especially CD!

May we please have a few lessons on how to tackle HMRC through the small claims court. I don't like injustice, and it seems unfair that HMRC can, and do, impose penalties and interest on overdue tax, but there are no compensations to our clients when the situation is reversed.

Maybe if a lot of accountants took the actions that CD adopts, maybe HMRC would take more notice?

However, I have one more question for CD, and please don't take offence (I am a blunt speaking Yorkshirewoman). You seem to have a lot of problems with HMRC, much more than most of us on here. This may be due to your having a larger no. of clients, and therefore more opportunity for a HMRC mess up, but could it be due to HMRC adopting 'payback' tactics, or deliberately being less cooperative? If so, then I will leave the litigation to you. I get enough hassle as it is.

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By chatman
25th Aug 2010 14:29

Worth complaining to HMRC first.

I complained to HMRC that they had behaved very badly, making it clear I was prepared to take the case further, and they refunded all my costs.

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25th Aug 2010 14:37

Shirley

However, I have one more question for CD, and please don't take offence (I am a blunt speaking Yorkshirewoman). You seem to have a lot of problems with HMRC, much more than most of us on here. This may be due to your having a larger no. of clients, and therefore more opportunity for a HMRC mess up, but could it be due to HMRC adopting 'payback' tactics, or deliberately being less cooperative? If so, then I will leave the litigation to you. I get enough hassle as it is.

Posted by ShirleyM on Wed, 25/08/2010 - 13:53

 

No it's not "payback".  A lot of cases we run are for other practices locally who dont have the legal expertise. Indeed I suspect the opposite actually applies.  Once HMRC realise that you wont put up with their B/S and that you will always file formal complaints and commemce proceedings if messed about they tend to be very careful before upsetting you :)

What we find is that at the grass roots they foul up as usual, but, we now have contacts in their complaints offices and indeed at HQ and once a case is escalated to them they do seem to be anxious to get it sorted quickly. 

As an example, last Thursday I had cause to ammend a client's 2010 Return and this resulted in a £950 additional refund being due to him. Of course, due to the long running fault on HMRC's sysem the minute an ammendment is filed you can no longer access that client's records (a fault they have been promising to fix for over a year to my knowledge).  So, since we couldnt access his records I phoned them on Monday and the refund had not been sent.  Within minutes they agreed to send it, and I notice it landed in our client account today.  Not bad, 6 days from filing the ammendment to receiving the cash. In fact the client is calling in this afternoon and I have his £950 in nice crisp £20 notes waiting for him - one happy client.

Also of course being on friendly terms with your local court listing officer helps. (OK it costs me a box of chocolates at Christmas - but its worth it). There is one particular judge I always try to get these cases listed in front of.  He's a lovely chap, but more importantly, he applied common sense - yes there are some!

A couple of years ago HMRC threatened a client with court action because she owed them £500 on a previous business.  However, at the same time they were sending her statements of account on her current business admitting that they owed her £650.  Now any sensible person (which rules out HMRC) would have smply sent her a cheque for £150. Instead they sued her. 

After listening to a particularly stupid tax inspector droning on for about 10 minutes this particular judge stopped him.  He then said that he had carefully read the papers submitted and did not need to hear any more. He then said - QUOTE - "I neither know nor care whether Mrs ***** owes this money - you're not getting it. You admit you owe her £650 - pay it. And Im awarding Mrs ***** £3,000 for the distress you have caused".  Quite a good result for saying tat Id submitted a 2 page defence and not even spoken in court :).

Incidently, I have abslutely no problem with blunt speaking Yorkshire women - so long as they are not Leeds United fans :)

 

 

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25th Aug 2010 15:05

Thanks for the info

I love it when HMRC get their comeuppance :)

No - I'm not a Leeds United fan - I hate football but I share your love of horses and other animals.

Did you watch Seabiscuit at the weekend? A wonderful film where the little horse beats the big horse. Similar to your experiences with HMRC!

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By Annetax
25th Aug 2010 15:20

How sad!

How sad that the Revenue cannot put into practice what they expect from businesses.

We have a recently incorporated client who has had £12k deducted in CIS. One of his contractors has given him some CIS statements made out to the company and some in personal names, despite being given the company reference. However, their head office has made all the HMRC CIS returns using the personal CIS references, which of course, our client has no knowledge of or control over. So our client is having to prove to HMRC all the deductions he has suffered and meantime, the repayment is in suspense.

He also has a £6k CT bill. However, he can't pay his CT as the CIS deductions are killing his cashflow. You might think the Revenue would have some sympathy and put the CT on hold meantime? Once upon a time, when humans were involved, maybe. Now - NO.

Oh, and the Contractor? Homebase plc!

 

 

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25th Aug 2010 16:04

£950 in £20 notes

CD

I usually only reply with technical answers but this made me smile. How many £20 notes are you hoding to make £950 and which one is cut in half?

Btw the rest of your answers are top drawer.

Malcolm

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25th Aug 2010 16:23

:)

 usually only reply with technical answers but this made me smile. How many £20 notes are you hoding to make £950 and which one is cut in half?

Btw the rest of your answers are top drawer.

Malcolm

 

Posted by shoshana on Wed, 25/08/2010 - 16:04

 

 

OK you have a good point.  Actually 48 notes and hopefully the client will have change.  Nice to find an acountant who can actually count :)

 

 

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30th Aug 2010 17:23

With respect I think a possibility has been missed here

If a Contractor had failed to make one or more of their CIS Returns, the corroboration of the amount would not reside on the HMRC computer. One assumes that the computers should cross check these figures (though they probably don't) and kick out a mismatch.

This would be why subbies are supposed to get the monthly summaries. HMRC will give credit for CIS tax even if they have not had it, if it can be shown that the tax was deducted from the subcontractor (insolvency of the contractor being an obvious such scenario)

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23rd Nov 2010 10:46

colleague having the same problems

A member of our 'informal' accountants group has just emailed me and he is hopping mad.

Three times this year HMRC have informed his clients that he has made mistakes when in reality they were HMRC mistakes! I quote from his email where he refers to his clients experience with HMRC:

In that conversation he was spoken down to, told the situation was his ‘accountants fault’ and that his accountant had ‘made a mistake’.  It was also intimated that ‘people like him’ (i.e. hard working people employing a couple of others, and desperate to do the right thing at the right time)  were the reason the country was in the state it’s now in because of his obvious aim to avoid tax.

He asks, as I do, is there anything we can do about this and is there an ulterior motive here?

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Just linked to this thread from the current 'bad mouthing' one .

I must admit I was slightly alarmed that the first two posts here were suggesting that you had to submit the contractor tax deduction certs in order to get a refund. I have never done this (since new CIS) and neither has a refund ever been delayed. Could someone just confirm that there is no basis to for my concern!

Its no wonder that accountants don't sleep sometimes as between HMRC, clients and AWEB very little seems sure in life!

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09th Feb 2011 10:36

You're correct

We dont send CIS statements, or copies of them, with the tax return, and have never had a problem with HMRC.

Getting the refunds to be paid is a different problem.

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09th Feb 2011 11:46

This doesn't address one problem

and that is the occasional dodgy contractor who deducts CIS and fails to give the client statement of the tax deducted.

I would advise all clients now to show this on their own invoices as evidence (one did and it was accepted as valid evidence and the refund made, although it took time for HMRC to make the cross check).

It does happen and there is often CIS tax decucted which cannot be accessed to or credited because a contractor has failed in his duty. Of course, when an invoice is raised and payment made is two different things, but if this is the only evidence you can use, it's better than nothing. Would not going back to compulsary CIS25s not be a better thing again? What are other posters thoughts on this?

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09th Feb 2011 16:13

TO CD
We have now commenced proceedings in the County Court to recover our client's tax, and to recover our costs plus damages for the distress caused to our client. So far HMRC have failed to file a defence (perhaps they have "lost" the summons too). Next week we will be requesting summary judgement and instructing bailiffs.

 

Whatever happened with that county court claims thing you mentioned higher up in the post, back in August?

Did you win? 

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