April 2007

Construction Industy Scheme

With the new scheme starting on 6 April 2007, HMRC have been issuing packs to contractors to help them with the new rules.
The new system which includes the introduction of a new monthly return will include:

• a new monthly status declaration that the contractor has considered the status of the subcontractors and is sure that none of them are employees
• new verification procedures to ascertain how subcontractors should be paid. HMRC will confirm whether subcontractors are entitled to be paid gross, net of 20% tax (not the 2006/07 rate of 18%) or under the new higher rate deduction for ‘unmatched’ subcontractors of 30%
• penalties for the late submission of the monthly returns and incorrect returns and new verification procedures for those engaging subcontractors.

Do get in touch if you want help implementing the new return.

Internet link:

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