CIS Changes April 6 2026: What Every UK Construction Firm Must Know

Published: March 2026 | Author: ComplianceAlert | Category: Construction Compliance, HMRC, CIS Target keyword: CIS April 6 2026 | cis nil returns mandatory 2026 | hmrc construction industry scheme changes Word count: ~1,100

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The Biggest CIS Change in Years Hits on April 6. Most Firms Don't Know It's Coming.

If you run a UK construction firm — whether you're a sole trader, a small contractor, or a larger firm with a CIS-registered supply chain — April 6 2026 is a date you need to know.

HMRC is making five changes to the Construction Industry Scheme (CIS) simultaneously. Most are not widely publicised. Some carry penalties that start immediately with no grace period.

Here's what's changing, what it means for your business, and what to do before April 6.

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Change 1: Mandatory NIL Returns Are Back

What's changing: HMRC is reinstating the requirement to file a CIS return even in months where you make zero payments to subcontractors.

Who this affects: Any contractor registered under CIS who has months with no subcontractor payments — which is most small construction firms.

What happens if you miss it: Automatic penalties. HMRC's penalty structure starts at £100 for a late return and escalates. These are issued automatically — no discretion, no reminders.

What to do: Set a calendar reminder for the 19th of every month (the CIS filing deadline). Even if you paid no subcontractors, log in to HMRC CIS Online and file a NIL return. Takes two minutes.

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Change 2: Gross Payment Status — 1 Year Becomes 5 Years

What's changing: If HMRC finds fraud in your business (or, critically, in your supply chain), they can now suspend your Gross Payment Status (GPS) for five years instead of the previous maximum of one year.

Why this matters: GPS allows subcontractors to receive full payment without the 20% CIS deduction at source. Losing GPS for five years is a serious cash flow hit — and from April 6, HMRC has much longer to hold it.

The new supply chain risk: Under the new rules, you can lose GPS if fraud is found anywhere in your supply chain — even with a subcontractor you didn't realise had compliance issues. The liability is no longer limited to direct misconduct.

What to do before April 6:

• Review your active subcontractor list in HMRC CIS Online
• Check the verification status of every subcontractor you've used in the past 12 months
• If any have unresolved HMRC compliance issues, consider pausing work until resolved
• Keep records of verification checks — these are your evidence if HMRC investigates

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Change 3: Ongoing Subcontractor Monitoring (Not Just Verification)

What's changing: Previously, CIS compliance meant verifying subcontractors once — checking their status in HMRC CIS Online before first payment.

From April 6, contractors are responsible for ongoing monitoring of subcontractor compliance — not just a one-off check.

What this means in practice: If a subcontractor falls out of compliance (late returns, HMRC investigation, etc.) after you first verified them, you may now carry liability if you continued making payments without monitoring their status.

What to do: Implement a quarterly review of your subcontractor list in HMRC CIS Online. For active subcontractors, check their status before each payment run if possible.

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Change 4: Ghost Worker Schemes — Expanded Liability

What's changing: HMRC is tightening enforcement around ghost worker schemes — arrangements where payments are made to fictitious subcontractors or where subcontractor identities are misused.

The new risk: If HMRC determines that ghost workers exist in your supply chain — even through a sub-subcontractor you didn't directly engage — the liability can now flow upward to you as the principal contractor.

Who's at risk: Firms that use multiple layers of subcontractors, particularly in groundworks, scaffolding, and labour supply chains.

What to do: Know your supply chain. Keep records of who actually worked on each site. Signed attendance records, photos, and site sign-in sheets all help demonstrate that workers were real and present.

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Change 5: New Reporting Requirements for Supply Chain Payments

What's changing: HMRC is updating its reporting requirements for payments within the CIS supply chain, with clearer obligations on contractors to document and report tiered subcontractor relationships.

The full guidance is expected from HMRC in late March — watch GOV.UK/cis for the updated technical notes.

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What Else Is Happening on April 6?

CIS is the construction-specific change, but April 6 brings a wider compliance wave:

National Living Wage — April 1 (3 days earlier): The NLW rises to £12.71/hour for workers aged 21+. If you have direct employees (not CIS subcontractors), your payroll must reflect this. HMRC enforcement is automatic.

Employment Rights Act 2025 — April 6: SSP becomes a day-one right — employees are eligible for Statutory Sick Pay from their first day of work, with no waiting period. Paternity leave also becomes a day-one right.

Making Tax Digital for ITSA — April 6: If you're a sole trader with income above £50,000, you need compatible MTD software in place from April 6.

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The Quick April 6 Construction Checklist

✅ Set up monthly NIL return reminders (19th of each month) ✅ Log in to HMRC CIS Online and review your subcontractor list ✅ Verify the status of every active subcontractor before April 6 ✅ Document your verification checks and keep records ✅ Check for any supply chain red flags (unverified workers, unusual payment patterns) ✅ Update payroll for NLW £12.71/hr from April 1 (direct employees) ✅ Review employment contracts — ERA 2025 day-one rights from April 6 ✅ If you're a sole trader above £50k income: check MTD ITSA software compatibility

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How ComplianceAlert Helps Construction Firms

Tracking five regulators (HMRC, HSE, ACAS, CITB, Companies House) manually is time-consuming and easy to get wrong. Changes like these often appear as GOV.UK guidance updates or HMRC press releases — not direct letters to your business.

ComplianceAlert monitors HMRC CIS, HSE enforcement, NLW changes, CDM regulations, asbestos requirements, and 7 more regulators — and sends UK construction firms alerts when something changes in their sector.

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👉 compliancealert.co.uk/construction

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Sources

• HMRC: Construction Industry Scheme guidance
• Finance (No. 2) Act 2023 — CIS amendments
• Employment Rights Act 2025
• National Minimum Wage rates 2026
• HSE prosecution database

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ComplianceAlert monitors UK regulatory changes for small businesses. We're not solicitors or accountants — this is informational. For legal advice on your specific situation, consult a qualified professional.