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CIS Contractors missing out on tax relief
Construction contractors working under the Construction Industry Scheme (CIS) are being urged to educate themselves about capital allowances, as they might be missing out on some tax.
David Redfern, tax expert and founder of DSR Tax Claims, has discovered that many contractors are missing out on valuable tax relief due to their lack of knowledge around capital expenditure and HMRC legislation. Many companies are missing out on thousands of pounds of tax relief per year, he says, mostly due to the complexity of the regulations, with contractors feeling discouraged from claiming for their plant and machinery expenditure.
He continued: “most CIS contractors are aware of business expenses such as their mileage and subsistence costs, but far fewer are aware of the advantages that can be gained through capital allowances.
“For many contractors, these advantages could be substantial due to the type of capital purchases likely to be made by those in the construction industry.”
CIS contractors are able to claim capital allowances on plant and machinery, including tools, as well as business vehicles such as lorries or vans, such large purchases can have a significant impact on a contractor’s finances. Many contractors are unaware of the full range of items that can be considered under capital allowances, these include: integral features of business premises, such as lifts or air-conditioning units, and fixtures and fittings, such as CCTV systems, kitchens, and bathrooms.
Mr Redfern added: “The feedback we received from CIS contractors throughout our campaign suggested that many construction contractors find the topic of capital allowances daunting due to the complex nature of capital allowance rules – however, with the substantial sums often involved in large business expenditure, it would benefit many to seek expert advice on claiming their full capital allowances.”
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