This Content Was Last Updated on June 9, 2020 by Jessica Garbett


Edit – September 2019 – these measures deferred until 1 October 2019
Edit June 2020 – deferred to 1 March 2021

Sharing this note published by HMRC today.  These changes for construction businesses, starting in October 2010, have not received much publicity as yet.

This reverse charge measure comes into effect on 1 October this year. Further information on the scope of the reverse charge and how it will operate can be found in this guidance note on GOV.UK.
The key aspects are:
• it will apply to standard and reduced-rated supplies of building and construction services made to VAT-registered business who, in turn, also make onward supplies of those building and construction services
• the scope of supplies affected is closely aligned to the supplies required to be reported under the Construction Industry Scheme, but does not include supplies of staff or workers
• the legislation introduces the concept of “end users” and “intermediary suppliers”. This covers businesses or groups of associated businesses that do not make supplies of building and construction services to third parties and as such are excluded from the scope of the reverse charge if they receive such supplies. Examples include landlords, tenants and property developers.
Further guidance on the reverse charge will be published in the coming months. More information can be found on the Construction Industry Scheme: a guide for contractors and subcontractors (CIS 340) webpage on GOV.UK.

Edit – detailed guidance now out