The Construction Industry Scheme (CIS) is the process used by HMRC to collect taxes from subcontractors pay, when they are working in the construction industry.
The term “construction industry” is very broad, however there are exceptions, for example carpet fitting, delivering materials, architecture, so it is very important to ensure that you are operating correctly.
While the Construction Industry Scheme (CIS) can seem intimidating, it’s essential to operate within its guidelines to ensure compliance.
All types of business can be in the construction industry, including:
Companies
Partnerships
Self-employed individuals
And these businesses can be the:
Contractor
Subcontractor
Contractor and subcontractor
Under the scheme, the terms ‘contractor’ and ‘subcontractor’ have special meanings that cover more than is generally referred to as ‘construction’. For my information, you may find it useful to download HMRC guide for CIS, please click here.
It is worth noting that that contractor is the person responsible for administering the CIS payments to sub-contractors and for notifying HMRC of the payment and deduction made.
Contractors and subcontractors cannot “opt out” of CIS, and HMRC will impose penalties on contractors who fail to comply with the HMRC CIS rules.
Whether you are the contractor, subcontractor, or both, we can help.
If you are the subcontractor, you will need to keep your records, including your monthly deduction statements, and details of any other business costs you have incurred. We can then prepare your accounts and tax return, notifying you of any tax liability or refund due.
If you are the contractor, you will need to prepare and submit the monthly CIS300 form, and we can undertake this work, including the calculation of deductions, on your behalf. Once the form has been drafted, we can also provide you with the monthly CIS deduction certificates to be given to your sub-contractors.
We can help you to initially register yourself or your business with HMRC as a contractor, subcontractor, or both. Once setup we can run the CIS scheme, calculating the deductions, advising the amount to be paid to both the subcontractor and HMRC, generating the deduction statements and submitting the returns to HMRC, on your behalf. If you are also a subcontractor, we can ensure that we include any CIS suffered by you into your monthly PAYE filing, to offset this against your own PAYE liability.
For anymore information, please contact us today.
Contact Us
Call Susan and the team on 01908 315 716 or email susan@holmesaccountancy.co.uk and let’s arrange a free, no-obligation discussion so you can see how Holmes Accountancy will truly leave you free to do what you’re good at.
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