Same tree, same chainsaw. Inside CIS on Tuesday, outside it on Wednesday.
CIS does not test what the work looks like. It tests why the work is being done.
Felling and clearance carried out as part of clearing a site for a construction project is a construction operation and sits inside the scheme. Tree surgery, landscaping, gardening and forestry that is not part of a wider construction project sits outside it. HMRC says so directly.
The distinction that decides your paperwork
Take two jobs in the same week.
A crown reduction on an oak in someone’s back garden. Outside CIS. Nothing is being built. You invoice the homeowner, you charge VAT in the normal way, and nobody deducts anything.
Clearing a plot of scrub and trees so a developer can start groundworks. Inside CIS. That is site clearance for a construction project. If the developer is a contractor under the scheme, they verify you and deduct at whatever rate your status gives you.
The work in the tree is identical. The tax treatment is not.
Where this bites is the firm that does both, which is most firms of any size. They register for CIS because of the development work, then either apply the scheme to everything or forget it exists on the domestic side. If you also pay climbers or groundies as subcontractors on the site clearance jobs, you are a contractor as well as a subcontractor, and that brings monthly returns with it.
Two things follow from that:
- Your job records need to say what the work was for, as well as what it was. “Fell three sycamore, Elm Road” tells you nothing. “Fell three sycamore, site clearance ahead of a housing development” tells you everything.
- Gross payment status is worth more to a firm with a heavy contractor mix than to one doing mainly domestic work. If most of your turnover is homeowners, the deductions never arise in the first place.
VAT, and why your customer mix matters
Homeowners are end users. The domestic reverse charge does not apply to them, so on domestic tree work you charge VAT normally and get paid the gross figure.
On site clearance for a contractor who is not the end user, and where the work falls inside CIS, the reverse charge applies. You do not charge VAT, and the contractor accounts for it.
A firm whose income is mostly domestic and whose costs carry input VAT can find its cash position looks very different in a year when the mix shifts towards development work. That is a forecasting problem rather than a compliance one, and it catches people out.
What else costs money in this trade
Kit. Chippers, stump grinders, chainsaws, climbing gear, winches, MEWPs and chip lorries. Most of it is plant and qualifies for capital allowances, and a lot of it is bought on finance, where the accounting treatment and the tax treatment are different things. A new chipper and a hired one are not equivalent on the numbers.
Certification and training. NPTC and City and Guilds tickets, aerial rescue, first aid, and refreshers on kit your insurer wants seen. Training your staff is an allowable cost and it is a recurring one, so it belongs in the budget rather than turning up as a surprise every renewal.
Insurance. This trade pays more for public liability than almost anything else we see in construction, and the premium is often set by how close your dismantles get to property and by your claims history. It is a fixed cost large enough to change your day rate.
Seasonality. Winter is the felling season and storms make revenue arrive in unplanned lumps. Nesting restrictions then limit what you can touch in spring and early summer, so cash flow planning for an arb firm is mostly about making a quiet stretch survivable.
What we do
Work out which of your jobs sit inside CIS and which do not, and set up your records so the answer is obvious at invoice stage rather than at year end.
Register you as contractor, subcontractor or both where you need it, and run the monthly returns.
Sort out gross payment status if the contractor side of your work justifies it.
Get the VAT right across domestic and contractor work, including the reverse charge on site clearance.
Job costing that shows what a day with the MEWP actually costs against a day of climbing work.
Plus the ordinary compliance. The routine compliance runs alongside all of that. Accounts, corporation tax, VAT, payroll and self assessment.
Who we work with
UK tree surgery, arboriculture and grounds maintenance limited companies turning over between £500,000 and £5 million, anywhere in the country.
Common questions
Do tree surgeons come under CIS?
It depends on the job. Felling and clearance done as part of preparing a site for construction is inside the scheme. Routine tree surgery, gardening and forestry that is not part of a construction project is outside it.
I only do domestic work. Do I need to register?
As a subcontractor, no, because your customers are not contractors. If you take on development site clearance, or if you pay subcontractors to do construction work for you, that changes.
A developer has deducted 30% from my invoice. Why?
That is the rate for an unverified or unmatched subcontractor. Getting registered and verified properly brings it down, and the difference is reclaimable either way.
Do I charge VAT to a homeowner?
Yes. Homeowners are end users, so the reverse charge does not apply and you invoice in the normal way.
Can I claim the cost of a new chipper against tax?
Generally yes, as plant. How much comes off in year one depends on how it is bought or financed, so ask before you sign rather than after.
Book a call. Send us a month of invoices and we will tell you which jobs were inside CIS, which were not, and whether your current treatment matches.
Common questions
Does CIS apply to tree surgeons?
Same tree, same chainsaw. Inside CIS on Tuesday, outside it on Wednesday. CIS does not test what the work looks like. It tests why the work is being done. Felling and clearance carried out as part of clearing a site for a construction project is a construction operation and sits inside the scheme. Tree surgery, landscaping, gardening and forestry that is not part of a wider construction project sits outside it.
Does the VAT domestic reverse charge apply to tree surgeons?
It follows the CIS answer above. Where the work falls inside CIS and your customer is VAT registered, registered under CIS and is not an end user, the reverse charge applies and you do not charge VAT. Where the work falls outside CIS, or the customer is an end user or a homeowner, you charge VAT as normal. Two jobs in the same week can be treated differently.