What is CIS?
The Construction Industry Scheme (CIS) is a tax deduction scheme. It aims to prevent the perceived lack of compliance that surrounds the construction industry by putting framework in place to ensure that tax payments are made on behalf of construction workers in the UK.
What does the scheme apply to?
The focus of the scheme is on payments for labour. Payments only fall under the scheme if they are part of a contract for construction services. Therefore, the payment of employed labourers through a PAYE scheme, would not necessitate CIS deductions. For the scheme to apply, there will need to be one party to the contract who is acting as a contractor, and one party who acts as a subcontractor. There will also need to be construction operations as part of the contract.
However, there are some new changes in tax law and other ways of paying subcontractors, one of the other of which might suit your circumstances.
HT Group can advise on the solution that would best suit your needs.
Please contact us for more information about CIS tax payment.