CIS ― compliance

Produced by a Tolley Employment Tax expert

Employment Tax

Guidance

The construction industry scheme (CIS) was devised to limit the amount of tax lost as a result of under-declarations or failures to notify chargeability by subcontractors, many of whom came to work in the UK for relatively short periods without paying any tax.

The scheme operates to withhold tax at source at the point of payment, thereby reducing the risk of a subsequent default by the subcontractor. Although, if the subcontractor can prove they have complied with their tax obligations then they are able to receive payments gross.

The scheme has undergone regular changes since its inception. The current regime came into effect on 6 April 2007.

For a summary of the CIS, see the CIS ― overview guidance note.

For an in-depth discussion of contractors and subcontractors, see the CIS ― contractors and CIS ― subcontractors guidance notes.

Finance Act 2021 introduced legislation to prevent non-compliant businesses from using the CIS to claim tax refunds to which they are not entitled. The measure allows HMRC to reduce or deny CIS set-off credit claimed on employer

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

Timing of disposal for capital gains tax

Timing of disposal for capital gains taxDate of disposalThe date of the disposal determines the period in which the gain is subject to capital gains tax (CGT). When the rates of CGT change, the determination of the date of disposal can also affect the rate of CGT that applies to the gain.See the

14 Jul 2020 13:50 | Produced by Tolley Read more

Year-end tax planning

Trusts and Inheritance Tax

Bare trusts ― income tax and CGT

Bare trusts ― income tax and CGTThis guidance note explains how trustees of bare trusts are treated for income tax and capital gains purposes. Although a bare trust is, in equity, a type of trust, for both income tax and capital gains tax purposes its existence is transparent. This means that no tax

14 Jul 2020 15:34 | Produced by Tolley Read more

Corporation Tax

Terminal trading loss relief

Terminal trading loss reliefTerminal loss relief for trade losses in the final 12 monthsTrading losses incurred by a company in the final 12 months leading up to the discontinuance of trade may be carried back for up to three years from the period beginning immediately before that 12-month period.

14 Jul 2020 13:49 | Produced by Tolley Read more

CIS ― compliance