Contractors statements

Contractors statements

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I am raising an invoice where I have used a sub contractor.    Do I charge Vat on the gross, or net amount I have paid over to the subcontractor? 

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Euan's picture
By Euan MacLennan
14th Sep 2010 16:34

Please clarify

When you say "net amount I have paid over to the subcontractor", what have you netted off - VAT?  CIS tax?

In general terms, you charge your customer whatever you have agreed with him, plus VAT on that amount.  The fact that you have used a sub-contractor to do some or all of your work should not affect your customer.

However, if you have agreed to charge your customer what you have paid to your sub-contractor, plus (say) a 20% mark-up, you would apply the mark-up to the total amount charged to you by the sub-contractor, excluding any VAT, but before any CIS tax deducted from your payment to the sub-contractor. 

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