Taxation - Late payers face probe
Late payment of employer tax and national insurance contributions by as little as three days could prompt a full-scale investigation by the Inland Revenue and Contributions Agency.
The move is part of an increasingly aggressive stance taken by the tax-collection authorities to ensure the building and construction industry complies with new rules on PAYE payment. Last month the Revenue revitalised its clampdown on bogus self-employed workers, deploying 50 extra inspectors, as well as a 20% increase in inspections. NIC evasion is estimated to cost the Treasury #3bn a year.
The TGWU has won assurances from the Revenue and CA that the transition will be strictly policed.
George Henderson, TGWU national secretary, said the Revenue and CA will investigate press adverts by contractors seeking self-employed labour and prosecute fraudulent avoidance of PAYE, as well as using case law to judge whether a worker is self-employed or an employee. ‘We are not anti self-employed, just the bogus self-employed,’ Henderson said. ‘The number of labour agencies exploiting the system and workers has forced us to ask the Revenue to enforce this crackdown fully.’
Alastair Kendrick, a senior manager with KPMG, claimed the tough stance was further evidence of the Revenue and CA’s commitment to stamp out NIC dodging. ‘I’m not at all surprised by this step.
‘They are taking this issue extremely seriously and all contractors need to look carefully at how they engage subcontractors.’
A spokeswoman for the Revenue refused to confirm the timescale for launching an investigation, but added: ‘There’s no excuse for employers not paying NICs and it has always been our policy to remind them of their non-payment at an early stage.’
