J&M Interiors v HMRC

In J&M Interiors v HMRC (TC03323 – 12 February 2014) the FTT had to decide whether a business had taken reasonable care in its compliance with the construction industry scheme (CIS).

The tribunal noted that the standard ‘does not require that mistakes must never be made’ and that the standard must be ‘appropriate and proportionate to the particular contractor’s business’. The tribunal pointed out that the mistake identified by HMRC had been the only mistake made over a seven year period stressing that a business of the size of J&M would not have a dedicated CIS function.

J&M’s subcontractor JB (a registered subcontractor under the CIS) had used stationery suggesting that it was trading as a limited company. However on being questioned by J&M JB had explained that it was old stationery for a company that had been dissolved. J&M had therefore continued to make...