Looking after the books is a complex prospect in the construction business, especially in comparison to other businesses. A typical business selling products from a fixed location uses standard accounting principles. Construction businesses, however, provide bespoke work in multiple locations, often using the services of contractors and subcontractors.
Construction businesses must keep tabs on costs such as travel time, delivery of materials and mobilisation of equipment. HMRC has introduced the Construction Industry Scheme (CIS), which sets out special rules for tax and National Insurance (NI) for those working in the construction industry. Construction industry businesses comprise contractors, subcontractors, companies, partnerships and self-employed individuals.
How does CIS work?
The CIS sets out special rules for tax and NI for those working in the construction industry. It applies to construction workers as well as those carrying out jobs such as alterations, repairs, decorating and demolition.
All contractors are required to submit an online monthly return to HMRC, even if they’re entitled to pay their PAYE quarterly. The return must include the following information:
- Confirmation that the employment status of subcontractors has been considered.
- Details of payments made to all subcontractors.
- Confirmation that the verification process has been correctly dealt with.
- Details of any deductions of tax made from those payments.
You can check out HMRC’s guide to the CIS here.
AMR can help
Here at AMR, we have a proven track record working with builders, property developers, joiners, roofers, decorators, electricians and plumbers to achieve compliance with the CIS rules. We can help you with registration and administering the scheme, from record keeping to verification, filling in your monthly CIS300 return and making deductions.
To discuss how we can help you manage your CIS compliance, please get in touch. Our experts are happy to help with any questions you might have.
