HMRC One to Many letter: Construction Industry Scheme Insurance Sector Registrations
HMRC have advised us that they have recently commenced a One to Many letter campaign directed at large businesses in the insurance sector that may be engaged in activities linked to the UK’s construction industry. The letters were sent electronically in the week commencing 8 July 2024 and the business’s allocated Customer Compliance Managers (CCMs) were notified prior to the issue of the letter. Letters were sent with a covering email that contained a dedicated project mailbox for recipients to send any queries to.
A copy of the letter is provided below.
The purpose of this letter is to:
- Prompt the businesses to consider their obligations under the Construction Industry Scheme (CIS);
- Increase the number of compliant large business insurance sector businesses that are registered for the CIS as 'deemed contractors' and improve tax compliance within the sector.
The educational letter is targeted at insurance sector groups which have entities whose business may involve the commissioning of ‘construction operations’ either:
- Directly with subcontractors, or
- Where they do this via a loss adjuster who acts on their behalf.
This includes groups whether or not they are currently registered for CIS.
The letter is aiming to ensure that insurance sector groups that commission ‘construction operations’ and have expenditure which exceeds £3 million in any rolling one-year period, register for CIS as a ‘deemed contractor’. HMRC want to ensure that they deduct the necessary tax from contract payments made to subcontractors (including loss adjusters), reflecting these on their monthly CIS returns.