What is a CIS Contract

What is a Construction Industry Scheme (CIS) Contract?

A contract may be:

• Written, or
• Agreed by word of mouth

Regardless of the form of the contract, the common feature will be a payment by a contractor to a subcontractor, and the contract will relate to ‘construction operations'.

Many contracts in the construction industry are agreed by word of mouth. This will not normally stop them from being legally binding on both parties and means they will come within the CIS rules.

What Counts as a CIS Contract?

In general terms a construction operation contract covered by CIS will include:

• Any contract that has construction operations included in it, however small a part that may be, will fall within CIS.
• Mixed contracts. If a contract includes some work that is within CIS and some that is nothing to do with construction, then all payments made under that contract will come within CIS.

What Type of Work is CIS Work?

Below are listed some of the types of work which are regarded as construction operations, and so included within the CIS rules:

• Buildings and structures
  • Construction
  • Alteration
  • Repair
  • Extension
  • Demolition
  • Dismantling
  • Construction
• Construction
  • To build
  • To make
  • To put together
  • To assemble
• Alteration
  • Where a building or structure has been made different in any way
• Repair
  • 'Making good' and replacement of defective or damaged parts of a building or structure
• Extension
  • Adding to or enlarging an existing building or structure
• Demolition
  • Pulling down a building or structure
• Dismantling
  • Taking a building or structure apart
• Works forming part of the land
  • All types of construction work that do not involve buildings or structures are called works forming, or to form, part of the land
• Installation of systems
  • Something that is made up of connected parts to perform a particular function
• Internal and external cleaning
  • Regarded as a construction operation if it is undertaken whilst the construction contract is ongoing
• Painting and decorating
  • Regarded as a construction operation
• Integral works
  • Works that must be carried out for a construction operation to be completed
• Preparatory works
  • Works that must be carried out before a construction operation can be started
• Finishing operations
  • Work that 'renders complete' or 'finishes off' any of the construction operations