Tax for construction lawyers

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Construction industry scheme

The construction industry scheme (CIS) was devised to limit the amount of tax lost as a result of sub-contractors in the construction industry under-declaring or failing to notify their chargeability to UK tax. The scheme operates to withhold tax at source at the point of making a contract payment (ie a payment made by a contractor under a construction contract), thereby reducing the risk of a subsequent default by the sub-contractor. However, if the sub-contractor can prove it has complied with the tax obligations it can apply to receive payments gross.

For more information on the CIS, see: Construction industry scheme—overview.

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Latest Construction News

UKGBC launches UK Climate Resilience Roadmap

The UK Green Building Council (UKGBC) launched the UK Climate Resilience Roadmap on 26 June 2025, the first guidance of its kind to outline how the UK’s built environment—including homes, schools, offices, hospitals, parks and infrastructure—is increasingly vulnerable to five key climate hazards: overheating, flooding, drought, wildfires and storms. The roadmap identifies 13 areas across the UK most at risk from extreme weather events, noting that places such as Peterborough and Fairbourne could become ‘likely uninhabitable’ by the end of the century due to flooding. It also identifies regions particularly susceptible to storms, wildfires and drought, and outlines strategies to help adapt buildings for a warmer, wetter future. The guidance calls on the government to treat climate resilience as a national emergency and includes several policy recommendations, such as establishing an Office for Resilience within the Cabinet Office, reinstating the Minister for Resilience, protecting all communities with trees, parks and ponds, and fostering a new generation of green professionals. It also sets out a four-stage framework designed to help built environment professionals integrate climate resilience into decision-making across organisations and project teams.

MHCLG publishes guidance for Responsible Entities on the Developer Remediation Contract

The Ministry of Housing, Communities and Local Government (MHCLG) has published guidance to assist Responsible Entities working with developers who have signed the Developer Remediation Contract (DRC). The guidance sets out the terms of the DRC and developers’ obligations, aiming to ensure all parties clearly understand these responsibilities throughout the remediation process. It also provides advice on adopting collaborative approaches to remediation projects.

MHCLG announces Building Safety Regulator reforms to accelerate housebuilding

The Ministry of Housing, Communities and Local Government (MHCLG) has announced a package of reforms to the Building Safety Regulator (BSR), aimed at accelerating housebuilding and remediation work. Key changes include: (1) the introduction of a new Fast Track Process, designed to integrate building inspector and engineer capacity into the BSR to expedite the processing and review of existing newbuild cases and remediation decisions; (2) leadership changes, with Andy Roe KFSM appointed as non-executive chair of a new MHCLG shadow board, which will oversee the transition of the BSR’s functions from the Health and Safety Executive, as part of initial steps towards establishing a single construction regulator, and Charlie Pugsley named as the new Chief Executive Officer of the BSR; and (3) further investment, with the recruitment of over 100 new staff to enhance the BSR’s operational capacity.

SSRO consults on proposed updates to baseline profit rate methodology

The Single Source Regulations Office (SSRO) has launched a consultation on proposed updates to the baseline profit rate (BPR) methodology for defence-related single source contracts. The updates respond to changes in the Nomenclature of Economic Activities (NACE) database and aim to align company size thresholds with new UK regulations. The consultation also seeks to resolve two outstanding proposals from the 2024 phase 2 consultation on the BPR methodology. The BPR methodology is used to determine initial profit rates for Ministry of Defence contracts let without competition, known as Qualifying Defence Contracts and Qualifying Sub-Contracts. The consultation closes on 11 August 2025.

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