What is CIS?
Subcontractors if registered have 20% tax deduction on labour at source
If unregistered then 30%
At the end of the Tax Year then the subcontractor has a Tax Return prepared, which then determines whether tax has been under or over paid for the work
Please note that there is no deductions on the materials provided by the subcontractor and that contractor has to be registered in a scheme and submit weekly, fortnightly or monthly reports to HMRC by paying over the deducted amounts from the subcontractor to the contractor
Please note without CIS vouchers/certificates or proof no claim can be made
We gained a new client today who felt that his income was low so he never completed a Tax Return for the tax year 2021-2022
However, he approached me to complete a Tax Return for 2022-2023
He insisted that he was self-employed as a skilled worker
We had copies of the bank statements with the same customers paying and with his authorisation we phoned and requested the supporting documents (Previously not received) to confirm that he was registered as subcontractor and 20% CIS was being deducted
By carrying out the investigations and asking the further questions, there is now a tax refund for the tax year 2021-2022 and 2022-2023, which if ignored would have resulted in the client paying unnecessary on income, which has already been taxed.
If you require any further assistance or unsure about your work status, please get in touch #tax #bank #selfassessment #selfemployed #payroll #accountingservices
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