The Government introduced changes to existing VAT laws to tackle rising fraud.
Under the Construction Industry Scheme (CIS), contractors deduct money from a subcontractor’s payments and pass it to HM Revenue and Customs (HMRC). The CIS was introduced to address the non-compliance and over the years, HMRC have introduced various amendments to CIS to tackle fraud.
The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
Contractors must register for the scheme. Subcontractors do not have to register, but deductions are taken from their payments at a higher rate if they’re not registered.
If you are a Construction Industry Scheme worker, need help understanding the changes to CIS or would like more information on the scheme and how to claim contact us.