Construction Industry Scheme (CIS) changes:

From April 2007, HMRC have made a number of changes to the manner in which the scheme is to be operated.  For complete details, see the HMRC website. 

The main points:

• No more CIS cards.
• Rate of tax to increase to 20%  (In certain circumstances 30%)
• No more monthly vouchers.  All tax deduction details in future will be on regular remittance advices.
• Any sub-contractor who has been paid by us within the 12 months preceeding any payment will be taxed in the same manner as last time, unless HMRC have informed us otherwise.  i.e if you received gross payments in November 2006, you will receive gross payments if we pay you before November 2007, unless HMRC inform us otherwise.
• Any sub-contractor new to us will have to have their employment status verified by us.
• Any sub-contractor new to us will have to have their tax status verified by us with HMRC.  ie gross or net of tax.