Making it in the workshop and delivering it is outside CIS. Fitting it on site is inside. Same staircase, same business, two regimes — and the contract decides which.
For a joinery business, the whole CIS and VAT position turns on one distinction from the statute. Section 74(3) of the Finance Act 2004 excludes the manufacture of building or engineering components or equipment, materials, plant or machinery, and the delivery of any of these to site. Section 74(2) includes construction, alteration, repair and extension of buildings — and CIS 340 expressly confirms that the assembly of prefabricated units on site is a construction operation.
So the staircase you make in the workshop and deliver is outside the scheme. The same staircase fitted by you on site is inside it. Same object, same business, two regimes.
Whether a job is a construction operation decides two things at once, not one. It decides whether the payment is inside CIS — and because the VAT domestic reverse charge takes its scope from the CIS definition, it decides the VAT treatment on the same invoice. Get the scope question wrong and you get both wrong together.
Because the scope question is answered by what the contract is for, not by what happened to be in the van. A supply-and-install contract is a construction operation. A manufacture-and- deliver contract, with the main contractor's own joiners fitting, is not.
Where a job genuinely covers both, invoice it so the two elements are visible. A single line reading "joinery works" across a workshop build and a week of fitting is a figure that cannot be justified afterwards — by you, by the contractor who has to decide the deduction, or by anybody reviewing either of you. And remember the contractor carries the responsibility for the materials figure being reasonable, so an invoice they cannot interpret is an invoice they may estimate.
On the fitting side, the deduction is charged on the payment less the cost of materials you directly incurred — timber, sheet, ironmongery and fixings on your own account. Also out: consumable stores, fuel other than fuel for travelling, plant hire, the cost of manufacture or prefabrication, and the VAT you have charged.
The "cost of manufacture or prefabrication" exclusion is worth noticing on this trade specifically: where you have made something and then fitted it under a single construction contract, that manufacturing cost is among the things that reduce the deduction base rather than sitting inside it.
Travel and subsistence remain inside the base in every case. For a joiner working across a wide patch, that is a meaningful sum being deducted from something that is not profit.
Self-employed, you deduct the actual cost of tools and equipment; under the cash basis you simply claim them as an allowable expense, cars being the exception on which capital allowances are still claimed. Employed, there is a flat rate of £140 a year for joiners and carpenters — the highest of the trade rates — which needs no receipts but is almost always less than a working joiner actually spends.
For the van, the Annual Investment Allowance covers up to £1 million of plant and machinery at 100%. But check the classification before assuming: a double-cab pick-up is, on HMRC's primary suitability test, usually a car — which means no Annual Investment Allowance and no full expensing on it at all.
Generally not. Section 74(3) excludes the manufacture of building or engineering components or equipment, materials, plant or machinery, and the delivery of any of these to site. So making a staircase, a run of units or a set of frames in your workshop and delivering them is outside the scheme. Fitting them on site is inside it — and CIS 340 expressly confirms that the assembly of prefabricated units on site is a construction operation. So the workshop half of your week and the site half of it can genuinely have different answers.
Then the treatment follows what the contract is actually for, and it is worth settling in writing before the invoice goes out rather than after somebody queries it. A contract to supply and install is a construction operation; a contract to manufacture and deliver, with somebody else fitting, is not. Where a job genuinely splits, invoicing it so the two elements are visible is far easier to justify later than a single line that blends them. The cost of manufacture or prefabrication also comes out of the payment subject to deduction, so a visible split is worth money as well as being easier to defend.
Only as an employee. The flat rate for joiners and carpenters is £140 a year — the highest of the building trade rates — and it needs no receipts. It is not available to the self-employed, who deduct the actual cost of tools and equipment instead. That is usually the better outcome for a self-employed joiner anyway, because real tool spend tends to exceed £140 comfortably. A self-employed joiner claims through the annual investment allowance, or simply as an allowable expense on the cash basis, and either route relieves the full cost.
If the fitting is a construction operation within CIS, the payment is CIS-reportable, both of you are VAT registered, the customer is CIS registered and is not an end user or intermediary supplier, and the supply is standard or reduced rated — then yes. Manufacturing and delivery on its own is outside CIS scope, so it is outside the reverse charge as well and carries normal VAT. The same business can therefore be issuing both kinds of invoice in the same week.
Three months of statements or returns, and a straight account of what is wrong and what it is costing.
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