The draft Finance Bill 2015 includes details of planned changes to the Construction Industry Scheme (“CIS”), aimed at easing the administrative burden for taxpayers. 

In its 2014 Autumn Statement, the Government confirmed its intention to introduce amendments to the CIS to improve its operation. 

As of 6 April 2015, the first of these changes came into force via the Income Tax (Construction Industry Scheme)(Amendment) Regulations 2015.  Most significantly, the changes brought about by these regulations mean that a contractor who has not made any payments to sub-contractors in a tax month is no longer required to submit a nil return.

The other key proposed changes to the legislation which are  not yet in force include:

  • Reducing the upper limit of turnover for partnerships or companies with multiple partners or directors to £100,000.  The result of this change will be to increase the number of partnerships or companies that may qualify for gross payment status;
  • Narrowing the compliance tests applied on a sub-contractor’s application for gross payment status; and
  • Introducing an online CIS digital account and generally seeking to improve online processes and verifications (planned for 2016/2017).