HMRC guidelines state that mainstream contractors may include:
- Property developers or speculative builders engaged in building, renovating, or converting properties.
Therefore, property developers fall within CIS. Property investors, such as rental companies, might also be caught by CIS if specific criteria apply.
- If a property investment business undertakes several or significant construction projects for development, it is classified as a property developer.
- Activities like constructing new buildings or redeveloping existing ones (including changing their use) are considered property development and bring the business under CIS as a mainstream contractor.
At present, your client's company does not fall within CIS. However, if they begin handling multiple projects or convert non-residential buildings to residential use, they would become subject to CIS requirements as a contractor.
These publications from Markel Tax were correct at the time of going to press and should be considered as principles-based guidance only. To check current validity, call the Markel Tax helpline. ICAEW (as distributor) disclaims all liability for any errors or omissions.
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