The turnover test is the second of three conditions a subcontractor must satisfy to hold Gross Payment Status (GPS) under the Construction Industry Scheme. It requires that the applicant's net annual CIS turnover from construction work meets a minimum threshold, measured over the preceding 12 months.
The thresholds for 2026/27 are:
- Sole trader: £30,000 net annual CIS turnover.
- Partnership: £30,000 per partner, or £100,000 total turnover (whichever is the lower hurdle to cross).
- Limited company: £30,000 per director, or £100,000 total turnover.
- Closely controlled company (5 or fewer controllers): £30,000 per controller.
“Net” turnover for the turnover test excludes both VAT and the cost of materials the subcontractor purchased for jobs. This definition mirrors the CIS deduction base (which applies to the labour element only), so the qualifying turnover is the labour and construction-services element of the subcontractor's CIS receipts over the 12-month measurement window.
A subcontractor who has only recently started construction work may not yet have 12 months of CIS receipts. In that case HMRC uses an annualised projection based on the period of trading available, though the projection must still reach the relevant threshold. HMRC verifies turnover at the point of GPS application and at each annual renewal review; a drop below the threshold in a review year results in GPS being removed.
The turnover test must be passed together with the business test and the compliance test: all three must be satisfied simultaneously. From 6 April 2026, passing all three tests is no longer the end of the story: Finance Act 2026 added an ongoing due-diligence duty that GPS holders must meet to avoid immediate revocation on fraud-related grounds.
Full details of all three GPS qualifying tests are at CIS gross payment status: how to qualify, apply and keep it. The impact of the April 2026 changes on GPS holders is covered at CIS April 2026 rule changes explained.