SolvedCISR18060 | The Scheme: miscellaneous: changes in taxpayer type
From HM Revenue & Customs · Construction Industry Scheme Reform Manual
| CISR Reference | Topic |
|---|---|
| CISR18600 | Action guide contents |
There are three main types of taxpayer for the purposes of the construction industry scheme; the sole trader, the partnership and the company. CIS subcontractor records are created when a parent SA or COTAX record exists and steps are taken to set up a CIS record. CIS contractor records are created when a parent Employer Business Service (EBS) record holds a ‘PSC’ or ‘XP’ identifier.
Where a taxpayer changes type, there will be changes to the parent SA or COTAX records. Those changes will feed through to the CIS system. Likely changes of type and their implications for the various HMRC systems are described as follows
| Taxpayer Type | Guidance |
|---|---|
| Sole trader to partnership | See A below |
| Partnership to sole trader | See B below |
| Sole trader to company | See C below |
| Partnership to company | See D below |
| Change in the constitution of a partnership | See E below |
A - Sole trader to partnership
This change may lead to
cessation of the sole trader source on the trader’s SA record.
any necessary change to the EBS system.
creation of a partnership source on the trader’s SA record.
creation of a record for the partnership on SA and allocation of a UTR.
issue of an application form CIS304 for each partner wishing to register for CIS on request only.
B - Partnership to sole trader
This change may lead to
cessation of this partnership source on each of the partners’ SA records.
any necessary change to the EBS system.
creation of a sole trader source on the SA record for all partners continuing to trade as sole traders.
issue of an application form CIS301 / CIS302 for the sole trader
C - Sole trader to company
This change may lead to
cessation of the sole trader source on the trader’s SA record.
any necessary change to the EBS system.
creation of a company record on the COTAX system and allocation of a UTR.
issue of an application form CIS305 to the company.
D - Partnership to company
This action may lead to
cessation of the partnership source on each of the partners’ SA records.
any necessary change to the EBS system.
issue of application form CIS305 to the company.
E - Change in the constitution of a partnership
This is not a change in the type of concern, but some of the implications are similar. This action may lead to the
need to change the partnership name.
issue of an application form CIS304 for any new partner wishing to register for CIS on request only.