Construction is a massive sector which has boomed over the past few decades. All sorts of developments have been undertaken from minor restorations through to building small houses and constructing massive shopping centres and stadiums. For many of these projects subcontracting plays a major part in their completion. The Construction Industry Scheme provides the regulations contractors must adhere to in relation to paying their subcontractors.
The scheme mainly applies to those in the United Built Homes Corporate Office industry although it can also apply to other organisations whose main focus is on other fields, if they still spend a significant amount on construction (on average A�1million or more over a three year period). Under the scheme those in the construction industry who are contractors or subcontractors may have to register with HMRC. The definition of contractors and subcontractors is extremely broad in this sense.
Many types of businesses are covered from self-employed sole traders right through to major corporations. Less mainstream construction such as property developments are also covered. If your organisation operates outside of the UK but still operates in the UK then CIS will still apply. The definition of Construction operations is also very broad, from temporary works, simple DIY like decorating right through to major construction.
As briefly evidenced CIS can apply to a wide range of individuals. It is surprising to many that strict regulations such as these can apply to such small businesses. Journeyman Electrician Job Duties For example if you are an independent builder and you occasionally subcontract small amounts of work you could be required to comply with the scheme.
If you think CIS could apply to you it is important to get to grips with your responsibilities under it including: making payments and being paid; keeping monthly financial records and what business changes you need to report. Make sure you are aware of and fulfil your responsibilities, whether you are a small or large business, a contractor or a subcontractor.
Construction