Under the Construction Industry Scheme (CIS),\u00a0contractors take money from a subcontractor’s payments and send it to HM Revenue and Customs (HMRC).<\/p>\n
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Are you up to speed with everything you need to know?<\/p>\n
Some key terms include:<\/p>\n
Construction operations<\/strong><\/p>\n These are the services the scheme relates to, such as work to permanent or temporary buildings, structures, or associated land.<\/p>\n Construction contract<\/strong><\/p>\n This is a legal agreement, where one person provides construction services to another.<\/p>\n Contract payment<\/strong><\/p>\n This refers to fees paid by a contractor to a subcontractor, or other party, under a construction contract.<\/p>\n The payments can be in the form of cash, cheque, or credit. Some payments are excluded from this, such as:<\/p>\n Deduction<\/strong><\/p>\n This is the sum of tax that a contractor must pay to HMRC from a contract payment.<\/p>\n The deduction will either be at the standard rate of 20 per cent or at the higher rate of 30 per cent.<\/p>\n The scope of the CIS<\/strong><\/p>\n HMRC handle overseas contractors and subcontractors in the same way as their UK counterparts.<\/p>\n If a construction project is carried out in the UK, the CIS will possibly need to be utilised.<\/p>\n Common pitfalls<\/strong><\/p>\n Some of the most common issues faced in relation to the CIS include but are not limited to:<\/p>\n What must you do?<\/strong><\/p>\n Subcontractors with gross payment status must stay compliant in order not to lose that status, which will ultimately have a severe impact on the business.<\/p>\n Additionally, errors by contractors can be expensive, as they can be held liable for CIS tax under deducted contract payments to subcontractors.<\/p>\n HMRC can reclaim that CIS tax for up to six years, along with interest charges and penalties.<\/p>\n It\u2019s vital that you seek professional help and advice when dealing with matters such as the above. Contact us today.<\/strong><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Under the Construction Industry Scheme (CIS),\u00a0contractors take money from a subcontractor’s payments and send it to HM Revenue and Customs (HMRC).<\/p>\n","protected":false},"author":1,"featured_media":2301,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11,20,12],"tags":[],"yoast_head":"\n\n
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