This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our privacy notice.

Company’s failure to deduct tax was despite reasonable care having been taken

By Mark McLaughlin, March 2025

A company’s managing director’s misunderstanding of the interaction between the CIS rules and the agency rules was despite him having taken reasonable care to comply with statutory CIS obligations, and the failure to deduct CIS amounts was due to an error made in good faith. 

Summary 

A company’s managing director’s misunderstanding of the interaction between the construction industry scheme (CIS) rules and the agency rules was despite him having taken reasonable care to comply with statutory CIS obligations, and the failure to deduct CIS amounts was due to an error made in good faith. 

Background 

The appellant company (HRL) contracted with end-clients in the construction industry to provide labour and identified workers to carry out the required tasks. HRL did not engage the workers. Instead, it contracted with intermediary agencies, and those agencies

Subscribe to the McLaughlin’s Tax Case Library to get instant access
to the Tax Case Library.
14 day free trial , 90 day money back guarantee
Subscribe

Related or similar articles

Loans paid to taxpayer as part of contractor loan scheme were taxable as employment income
By Andrew Needham, April 2026
Mistaken belief about tax position was a reasonable excuse in appeal against late payment penalties
By Mark McLaughlin, September 2025
Non-UK resident partner was chargeable to income tax on partnership profit share from trading with non-UK customers
By Mark McLaughlin, September 2025
Shares gifted to charity were overvalued for income tax purposes
By Mark McLaughlin, February 2024
Taxpayer’s information was insufficient to satisfy an information notice
By Mark McLaughlin, March 2021