07/06/2024
Construction Industry Scheme: 2024/25
HMRC’s recent Agent Update 118 summarised several changes to the Construction Industry Scheme (CIS) that took effect from 6 April 2024.
The first change extends the compliance tests that must be met before Gross Payment Status (GPS) is granted, adding an obligation to be largely up to date with VAT compliance (returns and payments). Compliance will also be re-tested more quickly, after 6 months of gross payment. In addition, the grounds when HMRC may immediately cancel GPS in cases of fraud will be extended to include VAT, Corporation Tax, Income Tax and PAYE (Pay As You Earn) compliance. If HMRC has grounds to suspect that the business has fraudulently provided an incorrect return or incorrect information in relation to any of these taxes, GPS can be immediately removed.
HMRC have helpfully confirmed that, where certain conditions were met, landlord to tenant payments for construction work will be outside the scope of CIS.
Finally, from 6 April, subcontractors are no longer able to register for the CIS or apply for GPS over the telephone, unless they are digitally excluded (i.e. they are unable to use computers due to disability, old age or religious reasons). A new online digital form for CIS subcontractor registration and GPS applications has been introduced. Supporting evidence can be uploaded and draft applications can be saved if necessary.
For more information on our personal tax services visit our webpage.
Please contact 023 8046 1235 or email Alan Rolfe if you would like more information on the above.
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