CISR43050 | Register and maintain subcontractor: gross payment or payment under deduction: changing a subcontractor's tax treatment from net to gross

| CISR43600 | Action guide contents | |—————————————————————————————————–|———————–|

A subcontractor’s tax treatment may be changed from ‘Net’ to ‘Gross’:

• where the subcontractor successfully passed the turnover test, business test and compliance test.

• as the result of a successful appeal by the subcontractor against ‘Net’ payment status.

1. When a subcontractor’s tax treatment changes from net to gross a notification of the change (CIS316) is immediately sent to all Contractor Schemes who have either paid or verified the subcontractor during the current and two previous complete income tax years.

2. A subcontractor will not be able to apply to change from net to gross payment if a ‘‘live’’ exclusion period has not ended. An ‘‘exclusion period’’ will begin on the day that gross payment status was removed, and will continue for a twelve month period from this date.