Income Tax (Sub-Contractors in the Construction Industry) Regulations 1975
| Jurisdiction | UK Non-devolved |
| Citation | SI 1975/1960 |
| Year | 1975 |
1975 No. 1960
INCOME TAX
The Income Tax (Sub-Contractors in the Construction Industry) Regulations 197528thNovember 1975
2ndDecember 1975
23rdDecember 1975Remainder on the day appointed under section 68 Finance (No. 2) Act 1975Remainder on the day appointed under section 68 Finance (No. 2) Act 1975
ARRANGEMENT OF REGULATIONS
PART I
GENERAL
1. Citation and commencement.
2. Interpretation.
3. Service by post.
4. Death of contractor.
PART II
PAYMENTS TO SUB-CONTRACTORS NOT USING SUB-CONTRACTOR'S TAX CERTIFICATES
5. Record of individual payment made and of amount deducted.
6. Deduction certificate to be given to sub-contractor.
7. Payment of amounts deducted to Collector.
8. Contractor failing to pay amounts deducted to Collector.
9. Recovery of amounts deducted.
10. Return by contractor at end of year.
11. Inspection of records of contractors and sub-contractors.
12. Formal determination of amounts payable by contractor.
13. Amounts deducted to be credited to sub-contractor's liabilities.
PART III
SUB-CONTRACTOR'S TAX CERTIFICATES AND VOUCHERS
14. Powers of Inspectors.
15. Forms of sub-contractor's tax certificates.
16. Issue of sub-contractor's tax certificates.
17. Validity of sub-contractor's tax certificate.
18. Renewal of sub-contractor's tax certificate.
19. Ownership, surrender and production for inspection of sub-contractor's tax certificate.
20. Form of voucher, ownership and surrender of voucher.
PART IV
PAYMENTS TO SUB-CONTRACTORS USING SUB-CONTRACTOR'S TAX CERTIFICATES
21. Production and verification of sub-contractor's tax certificate.
22. Alternative procedure for verification of sub-contractor's tax certificate.
23. Completion of and delivery of a voucher by a sub-contractor and obtaining of a voucher by a contractor.
24. Return of payments made without deduction to be made and records of such payments to be kept.
25. Return of vouchers.
26. Production of records for inspection.
SCHEDULE
Form 714I.
Form 714P.
Form 714C.
Form 715.
The Commissioners of Inland Revenue, in exercise of the powers conferred upon them by sections 69 and 70 of the Finance (No. 2) Act 1975(a), hereby make the following Regulations:—
PART I
GENERAL
Citation and commencement
1.—(1) These Regulations may be cited as the Income Tax (Sub-Contractors in the Construction Industry) Regulations 1975.
(2) Regulations 1, 2, 3, 14, 15, 16, 17, 19 and 20 shall come into operation on 23rd December 1975 and the remainder of these Regulations shall come into operation on the appointed day.
Interpretation
2.—(1) In these Regulations, unless the context otherwise requires—
"contract payment" means any payment such as is mentioned in the principal section;
"deduction certificate" mean the certificate specified in Regulation 6;
"national insurance number" has the same meaning as in the Social Security (Contributions) Regulations 1975(b) or the Social Security (Contributions) (Northern Ireland) Regulations 1974(c). as the case may be;
"nominee" means any person, other than the sub-contractor, nominated to receive and to whom is made a contract payment;
"registration number" in relation to a company means the distinctive number assigned to a company by the Registrar of Companies on registration under the provisions of the Companies Act 1948(d) or the Companies Act (Northern Ireland) 1960(e), as the case may be;
"sub-contractor's tax certificate" means a certificate under section 70 of the Finance (No. 2) Act 1975;
(a) 1975 c. 45.
(b) S.I. 1975/492. (1975 I, p. 1516).
(c) S.R. (N.I.) 1974/234.
(d) 1948 c. 38.
(e) 1960 c. 22 (N.I.).
"the principal section" means section 69 of the Finance (No. 2) Act 1975;
"user" means a person to whom a sub-contractor's tax certificate has been issued, which has not expired, and includes a person authorised to use such a certificate issued to a company under Regulation 15(4);
"voucher" means the form of voucher specified in Regulation 20;
the following expressions shall have the same meaning as in the principal section—
"appointed day"
"Class 4 contributions"
"construction operations"
"contractor"
"sub-contractor";
the following expressions have the same meaning as in the Income Tax (Employments) Regulations 1973(a) as amended—
"Collector"
"earnings related contributions"
"employee"
"income tax month"
"Inspector"
"year";
other expressions have the same meaning as in the Income Tax Acts or the Corporation Tax Acts as the case may require.
(2) The Interpretation Act 1889(b) shall apply for the interpretation of these Regulations as it applies for the interpretation of an Act of Parliament.
Service by post
3. Any notice which is authorised or required to be given, served or issued under these Regulations may be sent by post.
Death of contractor
4. If a contractor dies, anything which he would have been liable to do under these Regulations shall be done by his personal representatives.
PART II
PAYMENTS TO SUB-CONTRACTORS NOT USING SUB-CONTRACTOR'S TAX CERTIFICATES
Record of individual payment made and of amount deducted
5. On the making of any payment to which the principal section applies (that is to say a contract payment which is made to a person who is not excepted from that section) the contractor shall record in a form prescribed or authorised by the Commissioners of Inland Revenue the following particulars regarding that payment, namely—
(a) the name and address of the sub-contractor to whom, or to whose nominee, the payment is made;
(b) if the payment is made to a nominee, the name and address of the nominee;
(c) the date of the payment;
(d) the amount of the payment before any deduction under the principal section;
(a) S.I. 1973/334 (1973 I, p. 1147).
(b) 1889 c. 63.
(e) the amount, if any, included in the payment which the contractor has reason to be satisfied represents the direct cost to any person of materials used or to be used in carrying out the construction operations to which the contract under which the payment is made relates;
(f) the amount from which the principal section requires a sum to be deducted, and
(g) the amount so deducted.
Deduction certificate to be given to sub-contractor
6.—(1) On the making of any payment to which the principal section applies, the contractor shall give to the sub-contractor a deduction certificate, in a form prescribed by the Commissioners of Inland Revenue, certifying the amount, if any, deducted from the payment under the principal section and giving such other particulars as the prescribed form may require:
Provided that where, under any one contract, the contractor makes more than one payment to the same sub-contractor the contractor may, with the agreement of the sub-contractor, instead of giving one deduction certificate under this Regulation in respect of each such payment, give one deduction certificate in respect of all the payments made under that contract to the sub-contractor within one year or within such shorter period as the sub-contractor may request, being either a period beginning at the beginning of a year and ending, if the last payment to be made under the contract has not then been made, on the date in that year to which the accounts of the sub-contractor's business are made up or a period beginning on the last mentioned date and ending, if the last payment to be made under the contract has not then been made, at the end of the year in which that date falls.
(2) On the giving of such a deduction certificate as is referred to in paragraph (1) of this Regulation, the contractor shall record the amount entered on the deduction certificate on the form referred to in Regulation 5.
Payment of amounts deducted to Collector
7.—(1) Within 14 days of the end of every income tax month the contractor shall pay to the Collector all amounts which he was liable under the principal section to deduct from payments made by him during that income tax month.
(2) The Collector shall, if so requested, give the contractor a receipt for the total amount so paid provided that no separate receipt need be given for such amount if a receipt is given for a total sum paid at the same time which includes that amount and also tax deducted under the Income Tax (Employment) Regulations 1973, as amended, or earnings related contributions or both.
(3) If the amount which a contractor is liable to pay to the Collector under paragraph (1) of this Regulation exceeds the amount, if any, actually deducted by him from payments made during the relevant month but he satisfies the Collector that he took reasonable care to comply with the provisions of the principal section and of these Regulations and that either—
(a) the under-deduction or failure to make a deduction was due to an error made in good faith, or
(b) in spite of such reasonable care as aforesaid, he had been led to the genuine belief that a payment made by him, which was one to which the principal section applies, was not or was not wholly such a payment,
then the Collector may direct that the contractor shall not be liable to pay the said excess to the Collector.
Contractor failing to pay amounts deducted to Collector
8.—(1) If within 14 days of the end of any income tax month the contractor has paid no amount to the Collector under Regulation 7 for that income tax month and the Collector is unaware of the amount, if any, which the contractor is liable so to pay, the Collector may give notice to the contractor requiring him to render, within the time limited in the notice, a return showing the name and address of every sub-contractor to whom (or to whose nominee) he made any payment to which the principal section applies during that income tax month, the amount of every such payment, and any other matter affecting the calculation of the amount which the contractor was liable under the principal section to deduct during that income tax month.
(2) The Collector shall ascertain and certify the amount which the contractor is liable to pay to him in respect of the income tax month in question.
(3)...
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