Penalties for late or non-filing of a contractor's monthly return within the Construction Industry Scheme (CIS) are changing next month.

From 6th October, CIS contractor monthly returns will be liable to a new penalty regime.

The following penalties will apply to that return and all subsequent months' returns that are not filed or filed late:

• a £100 fixed penalty if the return misses its due date (the 19th of each month)
• a second £200 fixed penalty if a return is two months late
• a tax-geared penalty if the return is not filed six months after its due date – the greater of 5% of any deductions shown on the return or £300
• a second tax-geared penalty if the return is still outstanding after 12 months – the greater of 100% of any deductions or £3,000 if withholding of information was deliberate and concealed
• the greater of 70% or £1,500 if it was deliberate but not concealed; or the greater of 5% or £300 for cases where information was not withheld
• an upper limit (‘cap’) on the amount of fixed penalties charged to new contractors that have not filed their first returns on time
• interest on any penalty paid late

Interest will be chargeable on any penalty paid late.


The first return affected will be for payments made to subcontractors in the month ending 5 November 2011, which is due on 19 November 2011.

(CD/GK)