From a construction accountant’s perspective of how recent government updates can affect your construction business.
The previously delayed VAT Domestic Reverse Charge (DRC) comes into effect on March 1st, 2021. The DRC is essentially a change in the way VAT is handled for some construction services and the materials used, where they are supplied directly by construction and trade businesses.
The VAT domestic reverse charge which was due to begin in 2020 has been delayed to March 1st, 2021. The delay follows a previous reschedule to avoid the impact of Brexit.
IR35 (also known as off-payroll rules) was introduced for the public sector way back in 2000 and will be coming to the private sector in April this year. HMRC uses the off-payroll rules to correctly identify the employment status of contractors.
There are a number of challenges the construction industry is facing right now. Some are the same the sector has always faced, but newly heightened following COVID-19. On the other hand, the pandemic has brought new issues that are impacting productivity across the board.
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