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HMRC internal manual

Construction Industry Scheme Reform Manual

Register and maintain subcontractor: gross payment or payment under deduction: introduction

CISR43600  Action guide contents

This paragraph serves as an introductory overview of the examination of registration applications for net payment status and gross payment status.

This section covers the process from submission of the registration application, applying the tests for gross payment status and the outcome of the application, and the granting of gross or net payment status.

Subjects dealt with here are:

  • The order of applying the tests (greater detail is covered in the separate sections for each of the tests
  • Applications involving joint concerns
  • Applications involving changes in the type of the concerns

See the information and action guide menus for detail on any of these topics.

All applicants are initially granted ‘Net’ payment status. Gross payment status is only confirmed after the successful outcome of the Turnover test, Business test and Compliance test.

Applications for net or gross payment status can be made

  • in writing by completing forms;
CIS301 Sole traders (net payment status only)
CIS302 Sole traders (gross payment status only)
CIS304 Partners in a partnership or Trusts (net or gross payment status)
CIS305 Companies or Unincorporated Body (net or gross payment status)
  • by telephone, through the contact centre.

Where a new subcontractor telephones the contact centre and wishes to register for gross tax treatment immediately, the contact centre will make an appointment for them with a mobile adviser. The contact centre will advise the applicant of the various documents that the applicant will need to take with them in order for an Identity Check to be carried out, and that they should also take with them evidence of the turnover they intend to use for the registration form. The applicant will also be advised to take with them evidence to show that they also pass the Business and Turnover tests.

Once all this information has been seen the application form will be passed by the mobile adviser to the CIS Registration Team at National Insurance Contributions & Employers Office (NICEO) for processing.

HM Revenue & Customs have made a commitment to process all gross payment applications as soon as possible after receipt.

If gross payment status is granted to a subcontractor they will then be subject to an annual compliance test known as the Scheduled (or Ongoing) review to make sure that the subcontractor is continuing to meet all of their obligations under the Taxes Acts. Detailed guidance about the Scheduled review can be found at CISR49000.