Subby not filed a Tax Return for 20 years

Subby not filed a Tax Return for 20 years

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Was just wondering how other members would handle this with HMRC.

Just taken on a new client that has been a registered CIS Sub Contractor for in excess of 20 years but has never filed a Return.

He has moved around alot and therefore I guess HMRC have lost track of him even though he has been with the same contractor now for over 3 years.

The mix of income/expenses is such that he will most certainly be due refunds for each year, although only has records for 3 years.

Intial thought is to file last couple of years and ask HMRC what the current situation is?

Anyone had any similar cases? What are HMRC likely to come back with?

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By Vaughan Blake1
24th Mar 2014 14:57

Are you sure about the 20 years ?

I seem to recall the forebearer to CIS had to be renewed from time to time and wasn't given unless you were 'tax compliant'. This gave HMRC the opportunity to round up the bad boys!  I also remember that subbies could not be paid at all without registration. Could it be he was not having any tax deducted at all by being in the very dark grey economy? 

How did he get CIS status? This doesn't ring true to me, so beware it could be a huge can of worms!

Bill and be paid up front on this one methinks!

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By jon_griffey
24th Mar 2014 15:27

Out of time returns

I had a case this year where HMRC found out that a client had been a director for years and issued tax returns for 2005/06 to 2012/13.  There was no liability to report in any of the years.  Having filed them, we get a letter back from HMRC to say that 2005/06 to 2008/09 were out of time and they don't propose to do anything with them. Not pleased.

You may therefore find that HMRC refuse any repayments for out-of-time returns so you will be on a hiding to nothing.

I would therefore be inclined to write to HMRC and tell them the situation and that you will be filing returns for the recent years.

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