CONSTRUCTION SECTOR TAX ISSUES

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There are various issues that anyone working in the construction sector should be aware of:

Relevant contracts tax, Vat, RCT construction sector tax issues, construction sector

RELEVANT CONTRACTS TAX (RCT)

  • All contract and payment notifications are made electronically through ROS since 2012.
  • Revenue now have real-time information on activities of Principals and Subcontractors.
  • Since December 2015 each construction site is issued with a unique site identifier number.
  • Increased interventions by Revenue are dealing with abuses of the RCT system.
  • Penalties for unreported payments range from 3% to 35%.

EMPLOYED V SELF EMPLOYED

  • Revenue issued a Code of Practice for determining employment or self employment status of individuals.
  • Treating workers who are clearly employees as self-employed can lead to penalties and the liability can mount up quickly.

COUNTRY MONEY

  • All the criteria must be met before the payment can be made tax-free.

VALUED ADDED TAX

  • Reverse charge applies to Vat payments in respect of construction.
  • The Principal Contractor pays the Vat to Revenue rather the Subcontractor.
  • Where the Vat reverse charge applies, purchases must not be more than two-thirds of sales.