CIS reclaim for company without a payroll

CIS reclaim for company without a payroll

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I've just been told by a ltd client that they had CIS deducted from a couple of jobs during the past tax year (14/15) totaling around £2,000. This is the first time I've known about it, they haven't in the past done any work covered by CIS. The company doesn't currently have a payroll scheme as the directors have other jobs so there is no need. I'm aware that the usual procedure to reclaim the CIS would be to include it on the final RTI filing for 14/15 and then write and ask for the refund. My question is does anyone know of any alternative method of claiming the refund as if I request the opening of a payroll scheme for 14/15 retrospectively I'm concerned that the client is going to be hit with late filing penalties.

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By Matrix
07th May 2015 08:25

I think that the reclaim of CIS has always been through a payroll scheme, previously it had to be claimed on a P35, now an EPS.  To get the money back you will probably have to go down this route.  I would expect that you have good arguments against penalties but HMRC would have to bypass their systems and rules.  CIS repayments are caught between CIS and PAYE.

Surely your client had to be verified to give the info to the contractor?  Are you sure they didn't pay any subbies themselves?

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Euan's picture
By Euan MacLennan
07th May 2015 10:22

No risk of penalties

If you do set up a PAYE scheme - and I don't know what type of scheme that may be with no employees and no sub-contractors - the procedure is to file an EPS to report the CIS tax suffered and you can do that after the end of the tax year without any risk of penalties.

I would suggest that you first contact the CIS Helpline on 0300 200 3210 to explain the circumstances and ask them what you should do.

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By yogic accountant
07th May 2015 10:29

Thanks Matrix, looks like I'll have to set up a payroll scheme and appeal any penalties. The client did ( I think ) register as a subcontractor, this just requires the company ct reference no PAYE reference is asked for at that stage. Alternatively, and I need to check with the client on this, he may not have bothered and had 30% deducted. They don't pay any subbies themselves.

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