All contractors and subcontractors in the construction industry must be registered with HMRC under the Construction Industry Scheme (CIS).
The type of registration will depend on the type of entity, e.g. sole trader, partnership or limited company and the level of turnover.
Although the scheme is similar in many respects to the operation of PAYE, it is important to be aware that eligibility for “gross” registration is not a right and may be removed by HMRC in the event of default on filing CIS or other tax returns, or if payments in relation to any taxes managed by HMRC are not up to date. In the case of a limited company, the director(s) tax affairs must also be up to date.
It is essential to have an understanding of the activities that fall within CIS to ensure that the status of all subcontractors is dealt with correctly.
We have extensive experience of this specialist area and assist many subcontractors and contractors to register for CIS and to manage this on a monthly basis.
We have successfully assisted clients with appeals against penalties and threatened withdrawal of CIS status, where we have demonstrated that such action by HMRC has been unfair.
If you have any concerns about this area, or if you are in the construction industry and have not yet considered your obligations, you should contact us immediately to discuss how it might affect you.