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Important changes to the Construction Industry Scheme (CIS)

The new construction industry scheme (CIS) will be introduced from April 2007. This is 12 months later than previously suggested to allow the construction industry additional time to prepare for the new scheme.

New CIS will result in two main changes. At present, the identification card or certificate held by the subcontractor must be presented to the contractor before a contract is entered into under the provisions of the current scheme. These cards and certificates are being replaced by a new verification service requiring the contractor to establish the tax payment status of the subcontractor before making any payments under the new scheme.

Contractors' existing practise of using vouchers to account for payments and tax deducted under the current scheme will be replaced by monthly returns. The monthly return contains a declaration that the contractor is satisfied that the payments included in the return are not made under a contract of employment.

The new scheme will apply to around 200,000 registered contractors and 900,000 subcontractors.

For more information on the impact upon you please contact a member of the Advisory Team at TH Associates on 01442 230 100 or e-mail contactus@th-associates.com

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