CIS, the VAT reverse charge, gross payment status, Making Tax Digital and payroll for Birmingham trade businesses. Trades are our specialism, and we work with you remotely.
Birmingham is in England, so the Building Safety Levy applies here from 1 October 2026, though developments of fewer than 10 units are exempt, and the dutyholder and competence duties in SI 2023/911 apply to all building work. Everything on the tax side is UK-wide: CIS at 20% and 30% with the return due by the 19th and payment by the 22nd, the VAT domestic reverse charge, VAT registration at £90,000, Making Tax Digital, employer NIC at 15% above £5,000, and the £1,000,000 annual investment allowance. Building control for your work here sits with Birmingham City Council.
For a Birmingham subcontractor the single largest cash-flow lever is gross payment status. The turnover test is £30,000 for a sole trader, measured on relevant payments in the twelve months before the application and excluding both VAT and the cost of materials. It is your labour turnover that is tested. A single full-time tradesperson clears it comfortably.
A partnership needs £30,000 multiplied by the number of partners, or £100,000 in total. A company needs £30,000 multiplied by the number of relevant persons — its directors, and in a close company its beneficial shareholders — or £100,000 in total, using the maximum number of relevant persons at any one time in the twelve months. Either test will do; you do not need both.
The real hurdle is the compliance test, and it got harder on 6 April 2024 when VAT joined CIS, PAYE, income tax self assessment and corporation tax self assessment as a tested obligation. Minor VAT compliance failures do not cause refusal or removal — that protection was built in following consultation — but a pattern of late VAT returns is not minor, and a business with an immaculate CIS record can now lose gross status over VAT. The same reform brought the first compliance review forward from twelve months to six months after application.
The cash difference: on £180,000 of labour invoicing, gross payment status is around £36,000 that stops being locked up with HMRC until after 5 April. What losing it costs since 6 April 2026: immediate cancellation where the business knew or should have known payments were connected with fraudulent evasion of tax, liability for the lost tax, a 30% penalty reaching directors personally, and five years before you can reapply.
The same work whichever trade you are in, because the problems come from the scheme. We run the monthly CIS return and verification cycle, apply for and protect gross payment status, get the reverse charge right on your invoices and get end user notifications on file, put your records on software that satisfies Making Tax Digital, run payroll with the CIS offset claimed monthly through the employer payment summary, and prepare the accounts and tax return.
We also reconcile your CIS suffered to the payment and deduction statements every month, which is where under-claimed materials and missing statements turn up — see the records guide. And we treat your VAT compliance as part of your CIS position, because since 6 April 2024 it is: VAT joined CIS, PAYE, income tax and corporation tax in the gross payment status compliance test.
We write for each trade separately, because the scope questions differ. An electrician is inside CIS on power, lighting and fire protection and outside it on burglar alarms and CCTV. A steel fabricator is outside the scheme on manufacture and delivery to site and inside it on erection. A scaffolder is inside CIS, and separately hired scaffolding is standard rated for VAT even on a zero-rated new build. There are pages for plumbers, roofers, groundworkers, joiners, bricklayers, plasterers and every other trade we act for.
Six free calculators, no email required: the CIS deduction calculator shows what materials do to a deduction, the gross payment status checker tests you against all three statutory tests, and the reverse charge checker works through the six conditions on a specific job, and the capital allowances calculator shows what a van or a machine costs after tax relief.
Almost certainly not. The turnover test is £30,000 for a sole trader, measured on relevant payments in the twelve months before you apply and excluding both VAT and the cost of materials, so it is your labour turnover that is tested. A single full-time tradesperson invoicing labour clears that comfortably. Partnerships need £30,000 per partner or £100,000 in total, and companies need £30,000 per relevant person — directors, plus beneficial shareholders in a close company — or £100,000 in total, and either test suffices. The harder bar is the compliance test.
Six months, since the 2024 reform brought the first compliance review forward from twelve months. That makes the half-year immediately after a successful application the period to be most careful in, because a VAT or CIS return that slips in those first six months is reviewed while it is still recent. Registration applications were digitalised at the same time, which has shortened the front end of the process considerably. Remember that since 6 April 2024 the compliance test covers VAT as well as CIS, PAYE, income tax and corporation tax.
No. Birmingham is in England, and the Construction Industry Scheme is UK-wide: 20% standard rate, 30% higher rate, the monthly return due by the 19th and the money by the 22nd. The VAT domestic reverse charge, the £90,000 registration threshold, Making Tax Digital, National Insurance, corporation tax and the £1,000,000 annual investment allowance are identical too. What changes is building safety — the Building Safety Levy applies here from 1 October 2026, though developments of fewer than 10 units are exempt, and the dutyholder and competence duties in SI 2023/911 apply to all building work — and the income tax on your profit, which is the UK rates — 20%, 40% and 45%, with the higher rate starting at £50,270 on a full personal allowance.
No. We act for trade businesses in Birmingham and across the UK remotely — phone, WhatsApp, video and email, with records and approvals handled online. What decides a trade's tax position is knowing the scheme: whether the work is a construction operation within CIS, whether the payment is CIS-reportable, whether your customer has notified end user status in writing, whether the materials figure on your invoice will stand up, and whether you should have gross payment status. None of that is answered by being twenty minutes down the road. What being in England does change is building safety and, on income tax, uk bands: 20% / 40% / 45% — and we take that into account without needing an office here. Our calculators are free and need no conversation at all.
Whether work is inside CIS is decided by the work itself. Where it is done does not change it. These pages set out where the line falls for each trade, what comes out of the deduction base, and where the VAT treatment diverges from the CIS one.
A free call about your CIS position, your VAT treatment and how much of your money HMRC is holding.