Home   Tax and Accounting Advice in Dundee   Construction Industry Scheme – CIS

Construction Industry Scheme – CIS
CIS Contractors

CIS Contractors

Construction Industry Scheme

 

We have many clients in the Trade including Joiners, Roofers, Plumbers, Electricians and merchants.

 

The Construction Industry Scheme (CIS) is a specific set of rules for self employed workers in the construction industry with regards to their tax and national insurance payments.

 

You must register with HMRC if you are a Contractor or Subcontractor.  You may in practice be a Contractor on some jobs, and a subcontractor on other jobs.  If this is the case, then you will need to register with both HMRC CIS schemes as different rules apply to each one.

 

The CIS scheme covers all construction work carried out such as:

 

 

  • Site preparation
  • Alterations
  • Dismantling
  • Construction
  • Repairs
  • Decorating
  • Demolition

 

……………………………………………………………………………………………………..

 

Are you a contractor?

 

A contractor is a business or other concern that pays subcontractors for work.

 

If you are a CIS contractor you must:

Verify  your subcontractors with HMRC to ensure they are registered under CIS

  • make the right CIS deductions to payments you make to your subcontractors
  • any CIS deductions on to HMRC
  • file monthly returns with HMRC
  • keep full CIS records – You could be fined up to £3,000 if you can’t show your CIS records when asked by HMRC

Don’t worry if the above sounds complicated, AFM can deal with all this for you, to ensure deadlines are met, and you avoid late filing penalties.

 

……………………………………………………………………………………………………..

 

If you are you a subcontractor you must:

 

Register with HMRC under the CIS scheme (as well as registering with HMRC for self assessment)

  • Provide your contractor with details of your Unique Tax Reference Number (UTR)
  • Make annual self assessment tax returns on which relief can be claimed for any CIS tax deducted by the contractor

 

As a subcontractor, your contractor will make CIS deductions from any payments they make to you. These deductions will count towards your tax and National Insurance when you complete your self-assessment tax return.

 

……………………………………………………………………………………………………..

 

If you are an employee:

 

The CIS scheme does not affect employees, as you pay tax and national insurance through your employers PAYE scheme.

 

HMRC have an Employment status tool you can use to find out whether you are an employee or a contractor.

 

……………………………………………………………………………………………………..

 

Registering for the Construction Industry Scheme

 

You can register for the CIS directly with HMRC. If you are already self-employed but have not yet registered for the scheme you can call the CIS helpline and ask them to register you, just have your Unique Tax Reference (UTR) to hand.

 

Alternatively, if you have not yet registered as self employed, you can register for the CIS at the same time

……………………………………………………………………………………………………..

 

Completing your Contractor CIS Returns

 

As part of the CIS you need to file monthly returns with HMRC to inform them of the payments that you are making to subcontractors as part of the scheme.  Because there are now fines for late filing, we recommend you file your CIS returns electronically as it is easier and more efficient this way.

 

AFM will happily ensure your CIS returns are filed with HMRC every month on time; all we need is a short note (ideally spreadsheet) with details of all your payments to subcontractors each month.

 

 

 

 

 

 

 ……………………………………………………………………………………………………………………………….

Accountants for Plumbers Dundee, Accountants for Roofers Dundee, Accountants for Electricians Dundee, Accountants for Joiners Dundee, Accountants for Builders Dundee