Regulation 2 Amendment of the Income Tax (Construction Industry Scheme) Regulations 2005

The Income Tax (Construction Industry Scheme) Regulations 2005^f1 are amended as follows.

After regulation 20 (reverse premiums) insert—

“Payments made by landlord to tenant

20A.

(1)

A payment under a construction contract^f2 is not a contract payment^f3 if—

(a)

the payment is made by or on behalf of the landlord,

(b)

the person receiving the payment is a tenant or prospective tenant of the landlord,

(c)

the payment is for construction operations^f4 agreed in connection with a lease or an enforceable agreement to enter into a lease,

(d)

the tenant that occupies or will occupy the property will carry out the construction operations itself, or a third person will carry out the construction operations pursuant to a contract with the tenant, and

(e)

the payment is for construction operations relating to works intended primarily for the benefit and use of the tenant that occupies or will occupy the property under the lease.

(2)

For the purposes of this regulation—

(a)

references to “tenant” include, where the property is sub-let, a sub-tenant, and

(b)

references to “landlord” include—

(i)

the person who has legal or beneficial ownership of the property,

(ii)

the person by whom the lease is granted or was granted at an earlier time, or

(iii)

the person who will grant a lease in the future where they executed an enforceable agreement to enter into that lease.”.

In regulation 32 (exceptions from compliance obligations) in Table 3, column 1 (prescribed conditions)—