CIS RETURNS

CIS applies to most workers in the construction industry. If you are a contractor you will need to deduct CIS tax from your subcontractors.

If you use our services, we will submit your CIS Returns to HMRC before the 19th of each month.

A CIS return lets HMRC know how much CIS tax you have deducted from your sub-contractors and therefore how much you owe to them. Unfortunately penalties for late submissions are high. If it is one day late the penalty is £100 and if it is more than 2 months late a further £200 is payable. There are further penalties the longer it remains unsubmitted. Therefore it is very important that you either do it timely yourself or make an arrangement for a professional to complete CIS Returns on your behalf.

Also, if your company is the subcontractor, every month we will have to inform HMRC how much CIS Tax your contractor deducted from payments to you. You will be able to get the Tax overpaid annually after the 5th of April.

If you do not want deductions to be made in advance by contractors, you can apply for ‘gross payment status’.

To qualify, you need to show that:

• you have paid your tax and National Insurance on time
• your business does construction work or provides labour for it in the UK
• your business is run through a bank account
• During the last 12 months your turnover (excluding VAT and the cost of materials) must be at least:
  • £30,000 if you’re a sole trader
  • £30,000 for each partner in a partnership, or at least £100,000 for the whole partnership
  • £30,000 for each director of a company, or at least £100,000 for the whole company