# Builder not supplying tax clearance cert for Local Authority Grant.



## Dinarius (4 Dec 2012)

Firstly, if this is not the correct forum, please relocate as appropriate.

An elderly friend of mine borrowed money to have renovations done to his house. The money was/is to be refunded by his Local Authority as a grant for adapting the home for older living.

However, the builder is refusing to supply a tax clearance certificate, and without it the Local Authority will not hand over any money.

The builder is still owed some money which my friend has no intention of paying. But, the bulk of the cost has been paid over and this needs to be recovered from the Local Authority in order to repay the loan. In addition, the tax clearance cert has to be with the authority by the end of the year.

Has he any recourse?

Thanks.

D.


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## mf1 (5 Dec 2012)

"However, the builder is refusing to supply a tax clearance certificate, and without it the Local Authority will not hand over any money."

Which is why the builder, before being selected, should have been asked for the tax clearance certificate. Why, oh why, do people  do the daftest, daftest things and expect some sort of magic wand solution because of age, infirmity, (insert any other reason - as appropriate). 

Big lesson. 


mf


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## SarahMc (5 Dec 2012)

I don't think he has, unless the builder lied at the start of the job about having a clearance cert.

The Council won't pay out in this instance. I'm afraid your friend is stuck. If a price was agreed, your friend needs to pay for work done, it's not fair IMO to withhold payment due to his own negligence.


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## Dinarius (5 Dec 2012)

SarahMc said:


> If a price was agreed, your friend needs to pay for work done, it's not fair IMO to withhold payment due to his own negligence.



Are you seriously saying that my friend should pay the balance owed to the builder even though he (the builder) appears to be defrauding the taxman?

Please tell me I'm misunderstanding you.

D.


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## mf1 (5 Dec 2012)

But was it a condition of engagement that he would provide a Tax Clearance Certificate? 

And why do you think he is defrauding the taxman? It could be that he just does not need to draw attention to himself!

mf


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## Dinarius (5 Dec 2012)

mf1 said:


> But was it a condition of engagement that he would provide a Tax Clearance Certificate?
> 
> And why do you think he is defrauding the taxman? It could be that he just does not need to draw attention to himself.
> 
> mf



Yes, it was a condition.

And what in heaven's name to you mean by not wishing "to draw attention to himself"? 

Is it any wonder we're in the mess we're in.

D.


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## mf1 (5 Dec 2012)

"Yes, it was a condition."

So, why did your pal pay him anything before it was produced? 

"Is it any wonder we're in the mess we're in." - does this have anything to do with your pal not getting his ducks in a row?

mf


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## wbbs (5 Dec 2012)

I went through this process with my father few years back, before approval of the grant we had to provide estimate and tax cert from builder, by the time it was approved and built we were well into a new tax year and had to get updated cert from builder for that year before grant would be paid.  In other words it is entirely possible and probable given the rules for approval that the person originally submitted a tax clearance cert with the application, however the builder may not now have an up to date one.  That is what I imagine has happened, unfortunately I don't know the solution to it.

Just to add we were also paying the builder in stage payments and did not pay last one until cert was produced, obviously though we would have been left high and dry too at that stage if he was not in a position to furnish one.


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## Jim2007 (5 Dec 2012)

SarahMc said:


> I don't think he has, unless the builder lied at the start of the job about having a clearance cert.
> 
> The Council won't pay out in this instance. I'm afraid your friend is stuck. If a price was agreed, your friend needs to pay for work done, it's not fair IMO to withhold payment due to his own negligence.



As far as I remember if a builder fails to supply the required certificate, then you are obliged to withhold a certain percentage of the invoiced amount and pay it over to the revenue.  So I would think the is acting correctly, provided they pay it over to the revenue.


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## mandelbrot (5 Dec 2012)

Jim2007 said:


> As far as I remember if a builder fails to supply the required certificate, then you are obliged to withhold a certain percentage of the invoiced amount and pay it over to the revenue.  So I would think the is acting correctly, provided they pay it over to the revenue.



You're talking about relevant contracts tax, and that applies between a main contractor (principal) and his subcontractors, not between the customer and the main contractor as is the case here.


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## Vanilla (6 Dec 2012)

Dinarius said:


> The builder is still owed some money which my friend has no intention of paying.


 
Why? Is the work not done properly?

I presume he won't give the tax clearance cert as he wants payment. Can a compromise be reached?


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