The Income Tax (Construction Industry Scheme) (Amendment) Regulations 2015

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend the Income Tax (Construction Industry Scheme) Regulations 2005 (S.I. 2005/2045) (“the principal Regulations”) which make provision in relation to the Construction Industry Scheme established by Chapter 3 of the Finance Act 2004 (c. 12) (“the Act”).

Regulation 4 of the principal Regulations requires contractors to make returns to Her Majesty’s Revenue and Customs (“HMRC”) including, in regulation 4(10), where the contractor has not made any payments to sub-contractors in a tax month (a nil return). Regulation 2(2) amends regulation 4 to remove the obligation to make a nil return.

Regulation 56(5) of the principal Regulations provides that where a sub-contractor is a company, no repayment of any amount deducted and paid over to HMRC by a contractor under section 61 of the Act can be made to the sub-contractor until after the end of the tax year in which the deduction was made. Regulation 2(3) of these Regulations amends regulation 56(5) so that in certain cases (for instance where the sub-contractor is subject to a winding up under Part 4 of the Insolvency Act 1986 (c. 45)) where the amount deducted by the contractor under section 61 of the Act is excessive, a repayment can be made during the tax year.

A Tax Information and Impact Note covering this instrument was published on 10th December 2014 alongside a draft of this instrument and is available at https://www.gov.uk/government/collections/tax-information-and-impact-notes-tiins. It remains an accurate summary of the impacts that apply to this instrument.