Staged Payments liable for CIS

Staged Payments liable for CIS

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Hello all

Been trying to sort out my fathers paperwork - Construction company

He has an ongoing project which is  seperated into 4 phases.  He has invoiced the first stage and told me no CIS was due on stage/interim payments. Not an expert as inslovency qualified but tried phoning and the wwweb and couldn't find any clarification.

Also whilst you lovely people are ever so helpful - I have now taken over the monthly returns for payments deducted. 

  • 1) Am i supposed to provide a schedule for each sub contractor at the end of the year to show what tax has been stopped? 
  • 2) Anyone know of a great way/package to deal with monthly returns (found a few £100 penalty notices scattered in a stack of paperwork. 
  • 3) He alsois also acontractor in the restoration and modernisation ofa Grade 2 listed building - I telephoned HMRC and was told about the different way VAT is charged on items such as alterations etc.  However, the person ahead of us in the food chain told me its a 21 / 79% split (VAT charged on 79%) when I asked why -he said "just because"?! so will we get into trouble for not splitting it correctly and just taking advice from an email?  Project very large and would be soooooo time consuming....

Thank you loads for your help hoping might boost the cofidence and start clearing the backlog.

madeleine

Replies (2)

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By pawncob
12th Mar 2012 22:09

I wish.....

I'm afraid you must supply tax deduction certificates on a MONTHLY basis to each sub contractor.

If you keep manual records it should be quite simple to summarise the S/C position on a monthly basis. Don't know of a free S/C package.

As the main contractor he's responsible for determining the works which are VAT liable/zero/exempt. If the client doesn't like it an appeal can be made to HMRC. Don't accept anyone else's word unless they certify the position.

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By lesley.barnes
13th Mar 2012 11:13

I would get some training

Does your father use an accountant to do his year end? If so I would speak to them about getting some training on CIS and advise on the VAT situation. If not have a look if HMRC are going any training courses on CIS in your area - its straightforward but you do need to know what you are doing and when. If you get it wrong the penalties can be costly the £100 fines could just be the start. If your father is a Ltd company for example the CIS deductions he makes can be offset against deductions he suffers and balanced on the P35 at the year end.

Even staged payments should have the deductions.

I use Moneysoft payroll manager to do the CIS it provides monthly certificates, files the reports every month and does P35 if you need it and sends the request for verification to HMRC.

As pawncob says above your father is responsible for the VAT if he is the main contractor.

 

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