Construction Industry Scheme
Propelling the construction industry forward in helping the UK build back better has always been our objective.
As the construction industry experiences a boom with the surge in demand in the UK housing market, resulting from the stamp duty holiday running until 31 March 2021 on houses under £500,000, we thought this to be an ideal time to talk about the CIS and how this affects Contractors and Sub-contractors as well as how we can provide assistance to them in filing their accounts to HMRC.
At Cheylesmore Accountants we offer the following services to contractors:
- We can register you as a contractor with HMRC
- In addition we can also have your subcontractors verified with HMRC
- We will make sure that your subcontractors are being payed appropriately within the scheme
- We will keep your records in an organised manner digitally and supply the monthly returns to HMRC
- We can provide you with deduction statements to the subcontractors
With our software’s superior capabilities, we can provide assurance that you should never incur penalties due to late filings in submitting your monthly returns as we do all your accounts live. We are also always up to date with all the CIS regulations and would keep you updated and advise you accordingly on how to act upon these.
There are differences between the regulations that have to be abided by for contractors and subcontractors
The release of pent-up demand once lockdown measures eased have also contributed to the spike in construction activity across the UK.
As a subcontractor the main requirement that is needed is to register with HMRC and ensure that any changes to the business are kept up to date. Whereas with being a Contractor you would have to also register with HMRC, ensuring whether your subcontractors are registered with HMRC, making sure they are paid, calculating and reducing tax and submitting and confirming monthly payments and that these are all covered by the certain obligations needed by being contractor.
Not only do we provide services for contractors but we also help subcontractors too, we do the following services
- We would define whether your status is as an employee and subcontractor or if it is both and then register you onto HMRC appropriately
- On the behalf of your contractor we would verify you with HMRC
- We would keep your records of business fully managed and organised
- A self assessment tax return is also something we can prepare for your year end and also calculate your tax liability and see if there are any refunds applicable to you.
As a contractor it is important that you establish whether you are to be treated as employed or self employed for each contract. Should you be employed, the contractor will need to use a PAYE scheme where the National Insurance Contributions and tax for the purpose of the contract. Whereas if you are self employed then the you will be registered as a subcontractor by HMRC under the CIS scheme and you will be set up to receive payments ‘under deduction’. This therefore mean that a deduction of 20% tax must be made from the labour element of your invoices and it should be paid over to HMRC.
Whether you are a contractor or subcontractor at Cheylesmore Accountants we can help you, if you are interested please fill out the form below where we will contact you to discuss how we can help you or get in touch with us for a free consultation and rest assured we will handle all your financial requirements in a timely and accurate manner.