As announced at Budget 2014, a consultation has now been launched to look at ways of improving the operation of the CIS. The deadline for response to HMRC is 22 September 2014.

The Government has formulated proposals with a key objective of “relieving the regulatory burden of operating the scheme and reducing HMRC’s administrative costs”. The consultation also includes proposals to introduce mandatory on-line CIS filing for contractors. In addition, there is evidence to suggest that achieving and retaining gross payment status can be too difficult. Businesses told the Government that the current tests are complicated and can be difficult to comply with and that losing gross payment status for a minor failing can have a major impact on their business.

Small partnerships and companies can also be dissuaded from seeking gross payment status because of the level of turnover needed to obtain it. Chapter 2 of the consultation therefore sets out proposals for simplifying and improving the compliance and turnover tests which it is intended will enable more subcontractors to access gross payment status.