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ARTICLE · 08 AUGUST 2024

Reflecting On The CIS: Three Month Review

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Since April 2024, most landlord-tenant payments for construction work are exempt from the Construction Industry Scheme (CIS), reducing administrative burdens. This change aims to streamline tax compliance and benefits both landlords and tenants, though careful assessment is still advised.

United KingdomReal Estate and Construction
Charlotte Sallabank
Charlotte Sallabank
Gavin Vollans
Gavin Vollans
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Since 6 April 2024, most payments made by landlords and tenants are outside of the scope of the Construction Industry Scheme (CIS). New CIS regulations were introduced with the aim of streamlining the UK tax framework in relation to payments made by landlords for certain construction works carried out by tenants. Three months on from the introduction of the new regulations, we have provided our review and analysis below as to what the regulations entail, as well as the impact we expect the regulations to have on commercial landlord and tenant relationships in the future.

What is the CIS?

The CIS operates as a tax deduction mechanism framework, applying to payments under construction contracts made by contractors to subcontractors, and by subcontractors to sub-subcontractors, and so on down the construction chain. The regime was introduced to counter tax evasion from cash-in-hand jobs in the construction industry.

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