If you submit invoices to NCC to process, and the suppliers work falls under the scope of HMRCs Construction Industry Scheme, NCC will need to verify the supplier with HMRC before we can process payment.
The scheme covers all construction work including jobs such as:
Building works, site preparation, alterations, dismantling, heating and lighting systems, repairs, decorating and demolition.
The supplier should be aware of the scheme and should be registered as a sub-contractor with HMRC for us to process payment on your behalf. If not registered, they will be asked to do so.
We request the following details from the supplier to verify them
UTR (unique tax reference)
Company Reg or NI (national insurance number)
Name registered under
We also need the supplier to provide the labour/materials split on their invoices if the work carried out falls under the scheme.
The CIS is a HMRC scheme which applies if you work for a contractor (NCC) in the construction industry. Because NCC are deemed as a contractor by HMRC, any supplier automatically falls under the sub-contractor title. The CIS rules mean that NCC as the contractor are usually obliged to withhold tax on its payments to the sub-contractor, at either 20% if they are ‘registered’ or 30% if they are not.
Any amounts withheld by us will be paid to HMRC as advance payments towards individual income tax and National Insurance contributions (NIC) bill for the relevant tax year.
Subcontractors do not have to register, but deductions are taken from their payments at a higher rate if they’re not registered (30% Deduction).
Please ensure that any suppliers carrying out work within this scheme are aware of this process in advance.
If you have any questions, more details can be found at https://www.gov.uk/what-is-the-construction-industry-scheme, or contact Accounts Payable for advice.
