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HMRC internal manual

Construction Industry Scheme Reform Manual

The Scheme: construction operations: building service systems

CISR14600 Action guide contents

FA04/S74 (2)(c) states that the following operations are within the scope of the Construction Industry Scheme

  • ‘installation in any building or structure of systems of heating, lighting, air-conditioning, ventilation, power supply, drainage, sanitation, water supply or fire protection’

This provision is straightforward but you should note the following points

  • only ‘systems’ of a type listed in the subsection above are included. Note that it does not include other systems that may be found in a building or structure such as, public address, security, IT and so on
  • it only applies to installation of these systems, not their repair or maintenance. Neither does it apply to their alteration or extension(s).
  • replacement of a system, for example, complete electrical rewiring, amounts to installation
  • installation of such systems in locations other than a building or structure is normally caught by the other provisions of FA04/S74 (2). For example, external illumination of a building often involves running power-lines to lights located at some distance from the walls. Power-lines are ‘works forming part of the land (FA04/S74 (2)(b)).

The following paragraphs set out some general considerations and deal with special cases.

‘Systems’ generally

This provision refers only to the installation in a building or structure of the following service systems.

Heating Including central heating systems, hot air convection systems, and storage heating systems.

Lighting Including electrical lighting systems that provide illumination to the interior of a building or structure but does not include street lighting.

Air-conditioning Normally these are systems that use refrigerant, compressors and fans to cool the internal temperature of buildings and structures.

Ventilation Normally these are systems that allow clean/fresh air to flow in a building/structure, or the removal of stale air, dust or fumes, and can also used to tackle condensation or humidity.

Power supply Systems that supply power such as gas, for example, mains gas supply or liquefied gas, or Electricity for example, electrical wiring/cabling in building/structure.

Drainage Any system that takes waste water away from a building, for example guttering, down pipes, waste pipes, over-flows and external drainage, up to the point that they join the main sewer system.

Sanitation Toilets, urinals, hospital sluices and associated pipe-work.

Water Supply Can include water mains pipe-work to property, stopcock, water meters, hot and cold water pipe-work to taps, baths, showers, water tanks and so on, when carried out as part of the installation of the water supply system.

Although repairs to building service systems are not in isolation caught by the Scheme, if the contract to repair includes any making good to the building or structure, then the Scheme will apply to any payment under that contract.

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Repair of systems

The legislation regarding building service systems only refers to their installation. Therefore, repairs to any of these systems are outside the scope of CIS. Soldering a leaking pipe or patching a leaking boiler, replacing a defective tap, rewiring a single defective circuit, replacing a burned-out ventilation fan motor, replacing a broken wash basin, fixing a leaking radiator or replacing standard radiator valves with thermostatic valves, are all plainly repairs to a part of the overall building system.

Even where the repaired/replaced item may represent a significant component part of the overall system, such as a central heating boiler, its replacement does not constitute ‘the installation of a system of heating’ and therefore will not fall within CIS.

Repairs/replacements to building service systems will be caught, if they are carried out as part of a mixed contract of works, for example, a payment under a single contract to repair both a broken gutter (normally excluded) and replace broken roof tiles will all be caught under the scheme.

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Extending Existing Systems

As mentioned above only the installation of building systems is within CIS. As with repairs, extensions to systems will similarly be excluded, this could be for example, the addition of an extra radiator to a central heating system, or the wiring of additional electrical plug sockets.

Where a building has been extended by the addition of further floors above or rooms to the side, the extension work will be a construction operation caught by the scheme under FA04/S74 (2)(a). Any system extensions carried out as part of the same contract to extend a building or structure will also be caught as part of a mixed contract.

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Fire protection systems

See the information panel at CISR14160.

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Air-conditioning systems

Complete installation is within the Scheme. Replacement of parts is outside the Scheme.

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Solar Panels

The installation of solar panels to provide electricity will be a construction operation within CIS, except where the contract is directly with a private householder.

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Water-related systems

Installation of water meters, water softeners and other water treatment systems is within the scope of CIS.