Property Developer Activity

Is your limited company carrying out any property developer activities as listed in b and c below?

a) The company is purchasing property, carrying out repairs and then letting out the property in the company name.
b) The company is purchasing properties, carrying out repairs and then selling the property without letting it out (flipping properties)
c) A mixture of a and b

If yes, the please do let us know urgently as the company will be required to carry out further compliance activities as part of the Construction Industry Scheme (CIS).

The CIS is in place for contractors to deduct tax at source (20% or 30%) from sub-contractors which is then paid over to HMRC. The subcontractors then reclaim these deductions when they complete their tax returns (either personal or corporation tax returns). Please find links below to HMRC’s guidance on this matter for your perusal to determine if the limited company will be affected by this guidance or not:

Construction Industry Scheme (CIS) – GOV.UK (www.gov.uk)
https://www.gov.uk/hmrc-internal-manuals/construction-industry-scheme-reform/cisr12080
https://www.gov.uk/what-you-must-do-as-a-cis-contractor/who-is-covered-by-cis

If the company is caught by this, a PAYE scheme will need to be set up with monthly CIS submissions due by the 19th of every month.

If you require any assistance with this, please do let us know so we can advise accordingly.

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Registered in England. Company Number 7319439. Director S S Thandi BA