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13th Apr 2024
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Six months to go before the new CIS

by The Editor at 10:28 12/10/06 (CIS News)
HM Revenue & Customs (HMRC) is urging the construction industry to 'get ready' for the introduction of the new Construction Industry Scheme (CIS) in April 2007.
With just six months to go before the shake-up, HMRC is reminding contractors that they need be ready for three big changes:
  • Cards and certificates are being replaced by a 'verification' service to confirm whether subcontractors should be paid gross or net

  • Instead of issuing vouchers, contractors will make monthly returns and issue pay statements
  • The monthly return will include a declaration that the contractor has considered the status of the workers on the return and that none of them is an employee.

Contractors can get advice from a number of places: the HMRC website, the helpline on 0845 3667899, Employer Talk events, Business Advice Open Days and joint events with Scottish Building.

New CIS Programme Director, Mark de Brunner said: "Our website has easy-to-use tips on New CIS, including how to fill out monthly returns on paper and submit returns electronically. It lists a number of software providers who have updated their packages to support new CIS.

"There is also advice for contractors on how to confirm the employment status of their workers - whether they wish to do this online or over the phone.

"More in-depth advice is available at Business Support Team seminars, which are held throughout the country. Our website gives details on how to book a place on an event near you, or telephone 020 7667 4827."

New CIS is designed to create a level playing field for those working in the sector. Under New CIS, the old registration cards and tax certificates of the current scheme will be phased out, and a new verification system will be introduced to ensure that when a contractor engages and pays a subcontractor, the contractor knows whether to pay the subcontractor in full or make a deduction from the payment. If the subcontractor is not registered, the contractor will be told to make deductions at a higher rate.

Contractors must also satisfy themselves that the terms of any contract they have with their subcontractors are those of self-employment. If contractors need help to make a decision on a subcontractor's employment status, they can call the CIS Helpline or use the Employment Status Indicator tool on the HMRC website.

Currently subcontractors hold a tax certificate or registration card, which are presented to contractors before any payments can be made. These documents indicate whether a subcontractor should be paid gross, or under deduction. For all payments, contractors also must submit vouchers on a monthly basis to HM Revenue & Customs. Contractors are also required to complete an end-of-year tax return.

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Susie Hughes Hardhatter.com 2006
The Editor

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