Lee Sharpe looks at a rare win for the taxpayer in the construction industry scheme, and a potential lifeline for people caught out by it.
The case of Beech Developments (et al.) v HMRC [2024] EWCA Civ 486 is most welcome for those businesses that catch a nasty case of ‘accidental CIS’. Having been heard at the Court of Appeal, it effectively overturns numerous earlier cases heard only at the tribunals, and HMRC must abide by it. (In fact, HMRC’s guidance, such as in its Construction Industry Scheme Reform Manual at CISR83600, was only recently updated, in January 2025).
Some property-adjacent businesses may believe they do not fall within the scope of the Construction Industry Scheme (CIS), but a note of caution: HMRC is more than happy to lean on quite sweeping definitions in the legislation to style a humble property investment business foolhardy enough to pick up a trowel as falling within the scope of &lsquo