The Construction Industry Scheme
The CIS is a set of special rules for tax and National Insurance (NI) for those working in the construction industry. Businesses in the construction industry are known as ‘contractors’ and ‘subcontractors’.
The scheme applies mainly to contractors and sub-contractors involved in construction however certain businesses that are not in the business of construction but have a significant amount of annual spend may also count as contractors.
The CIS can apply to all types of businesses that work in the construction industry in the UK.
- self-employed individuals working as sole traders
- Limited Liability Partnerships (LLPs)
As well as traditional construction businesses like builders, the scheme can also apply to businesses like:
- labour agencies and staff bureaux
- gangmasters – or gang leaders
- property developers
There are penalties for late submission of CIS contractor monthly returns. The penalties increase the longer the returns are outstanding.
HMRC has been working with professional bodies, tax charities and businesses on a number of initiatives to improve service delivery. The group have looked at a number of different areas to improve HMRC’s service to taxpayers. One of these areas was the CIS. From April 2014, taxpayers can expect an improved experience when they request a CIS repayment. This includes faster repayments and processing of claims.