Are you a subcontractor in the construction industry?

Have you ever considered applying for Gross Payment Status?

Many who are subject to CIS love that they get a refund at the end of the year, it can help smooth out the tax payments and feels like a little bonus at the year end.

At times though cash flow can get tight, would you benefit from acquiring gross payment status so your invoices are no-longer paid under deductions? Leaving you to budget and settle your tax bill in your own time? Even if cash flow is not tight, would you rather be more in control of your tax payments?

In order to qualify to apply for gross payment status as a sole trader turnover (less materials and VAT) must be £30,000 or more in the last 12 months. For Limited companies the rules are slightly different, details on these can be seen below.

You will need a good compliance record in submitting Returns and paying any taxes due to HM Revenue & Customs. A few minor slipups are allowed, but overall you would need to demonstrate a good record of compliance.

Would CIS Gross Status benefit your business? If you would like to discuss this and find out how I could help you with the application please give me a call or send a message.

Qualifying as a company

Companies can take the standard test or the alternative test. To pass the standard test the company must have a net construction turnover of at least £30,000 for each director (and beneficial shareholder if the company is a close company), in the 12 months before the date of the gross payment application. To pass the alternative test, the company must be able to demonstrate a net turnover of at least £100,000 during the same period.

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