Pictured: Paul Edwards 

The new penalties regime for late or non-filing of monthly returns under the Construction Industry Scheme (CIS) took effect from October and first filings under the new arrangements are now being made.

However there is some good news, according to Paul Edwards, tax director at the Midlands office of national audit, tax and advisory firm Crowe Clark Whitehill.

He said: "The new regime will in many cases result in lower penalties than had been applied under the old one.

"Furthermore, if you have been charged penalties under the previous system which had been in place since April 2007, and charged more than what they would be now, you can request the difference back!" 

Under the changes, there is now a fixed penalty of £100 immediately a return is late; a second, fixed penalty of £200, two months after the filing date if the return is still outstanding; and then further hits of no less than £300 - in fact five per cent of the deductions if that amounts to more than £3300 - six months and one year after the initial penalty was raised, if the return is still then outstanding.

Mr Edwards said: "So what should you do now? If you have been charged a penalty under the old regime you should review the penalty against the new regime and see if you would have paid less. If this is the case you should write to HMRC and make a claim for a repayment.

"And, if that sounds complicated, we can help. Our CIS specialists have helped many construction businesses to meet the compliance requirements and defend penalty assessments."

For more information about Crowe Clark Whitehill, please visit their website here: www.croweclarkwhitehill.co.uk