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What is CIS? How can I claim back CIS deducted by contractor?

What is CIS? How can I claim back CIS deducted by contractor?

CIS stands for Construction Industry Scheme. Under these scheme contractors are required to deduct money from the payment to be made to subcontractors and pass it to HM Revenue and Customs (HMRC). These deductions are considered as advance tax and/or NI towards subcontractor annual income. Deduction amount is usually 20%, however if the subcontractor has not registered with HMRC, then deduction would be 30% of total income receivable. Thus, it is advisable to register yourself with HMRC as a subcontractor.

To make Claims-

  • Process of claiming back excess of deduction is different ¬†for a company and individual.
  • If you operate via a company, then you may have option to claim CIS suffered while filing your monthly payroll. Alternatively, this can be done once corporation tax liability is computed after finalising annual accounts.
  • If you are trading as self-employed, you will have to wait until you file your Self-Assessment tax return for relevant tax year to recover extra payments.
  • We at Affinity Associates provide all kind of services for companies and self-employed people. Please contact us for further information.

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