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HMRC internal manual

Construction Industry Scheme Reform Manual

HM Revenue & Customs
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Register and maintain subcontractor: gross payment or payment under deduction: joint concerns / ventures / limited liability partnerships.

CISR43600 Action guide contents


Partnerships are normally made up of individuals. Applications for gross payment status by more complex partnerships should be dealt with by Higher or Senior officers. The following are examples of complex joint applications:

  • Individual partner A and company B Ltd in partnership (a mixed partnership)
  • Company C and company D in a joint venture
  • Company E and company F in a legal partnership

Mixed partnerships

Partnerships that feature a mixture of individuals and companies should complete application form CIS304, partnerships that feature companies only should also complete application form CIS304. Only one partner can complete the form and that person is known as the ‘registering partner’. A mixed partnership can be made up of individuals and one or more companies or sometimes just two or more companies where the participants are operating under a deed of partnership or as an unincorporated Joint Venture.

Turnover test

In many cases, a mixed partnership will use the standard turnover test.

The multiple partnership turnover threshold is worked out as follows:

  • the number of individual partners excluding the company multiplied by the minimum turnover amount


  • the number of relevant persons appropriate to the company multiplied by the minimum turnover amount

The alternative turnover test applies where a partnership has a turnover in excess of £100,000 during the 12-month period preceding the date of application. The threshold is set and is not related to the number of partners.


Where a mixed partnership is using the standard turnover test you need to confirm the number of relevant persons.

Companies that are wholly owned by companies that already hold gross payment status are not required to pass the turnover test.

Business and compliance tests

Where the partnership passes the turnover test, the normal business test and compliance test rules apply. The compliance test applies to each member of the partnership.

Guidance on applying the business test can be found at CISR45000 and the compliance test at CISR46000 onwards.

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Joint ventures and partnerships of companies

Partnerships, unincorporated joint ventures or consortia that feature only companies should apply on form CIS304 as far as possible. The CIS304 should be signed by the company secretary of the senior member company in the partnership. In the case of a 50/50 arrangement, either company secretary may sign. Only where the Joint Venture is itself a corporate body, should the application form CIS305 be used. For more detailed guidance on processing registration applications from Joint Ventures see the guidance at CISR42100 and CISR42730.

Turnover test

Again it is likely that this type of partnership will use the standard turnover test. Where the partnership has a turnover in excess of £100,000 during the 12-month period preceding the date of application the alternative threshold will apply.

Business test and compliance test

A mixed partnership involving companies must pass both the business test and compliance test before gross payment status can be granted.

Guidance on applying the Business test can be found at CISR45000 onwards and the Compliance test at CISR46000 onwards. Guidance on processing a registration application from a Joint Venture can be found at CISR42100.

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Limited Liability Partnerships

These are new entities created by the Limited Liability Partnerships Act 2000 where the partners have limited liability in the event of the failure of the business. For the purposes of CIS and the application to register with net or gross payment status they are treated in exactly the same way as ‘normal’ partnerships, using form CIS304 to make an application to register. They can also have partners who are themselves limited companies.

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Sometimes companies work in association on a single project but there is no ‘business’ standing apart from their own respective businesses, neither do they share profits and losses. This situation is described in the Business Income Manual at BIM72010 as not constituting a partnership. There is no suggestion here that these loose associations represent Unincorporated Associations, these are dealt with separately in the Company Tax Manual at CTM41305. These associations are sometimes called a ‘JANE’ which is an acronym for ‘Joint Association No Entity’. The contractor will need to verify and pay separately each of the parties involved in the JANE for the works that they each carry out in fulfilling the construction contract.