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I have recieved a random payment amount from a customer with no payment advice. The amount is £8000  this amount is obviously minus cis deductions which they have charged at 20% of 20% is there a formula to work out the cis?


CIS deductions    1 thanks

Anonymous | | Permalink

If you want to calculate the CIS deducted then I usually gross the figure up, in this case 8000 divided by 80 and times 100. This gives you 10,000 and dedcut your net figure of 8000 leaving you with 2000 cis tax. Is this what you meant??

brain overload!!

isherwood | | Permalink

-- sleep twitch

I just didnt think it was as simple as that. As the 20% cis deduction is only applicable to 20% of the gross figure  so it wouldnt be 20% of the whole amount!

petersaxton's picture


petersaxton | | Permalink

Where do you get 20% of 20%? 

Gross is £100

Deduction is 20% of gross

Therefore net is 80%

It's simple to work out the gross

not that simple really!

isherwood | | Permalink

-- sleep twitch

The amount paid is £8000 only the labour part of this amount is subject to cis which they have calculated at 20% so the cis is 20% of the labour 20%.however the £8000 is there payment already minus the cis deductions!

petersaxton's picture

Just do the maths

petersaxton | | Permalink

"The amount is £8000  this amount is obviously minus cis deductions which they have charged at 20% of 20% is there a formula to work out the cis?"

How do you know that CIS deductions are 20% of 20%

If this is the case then:

Gross is 100%

Materials are 80%

Labour is 20%

CIS deduction is 20% of Labour which is 4%

Payment is 96% and £8,000

CIS deduction is 4% = £8,000 / 96 x 4 = £333.33

What you should do is ask for their calculation otherwise you may not be using the same figure they are.

I doubt the amount is random but it could be wrong.





isherwood | | Permalink

-- sleep twitch

believe me the amount is completley random as the original invoice was for £10,950 plus vat  with the labour  and materials clearly worked out.After requesting pay advice on several occasions with many unfufilled promises working it out was the only option left.

thank you


isherwood | | Permalink

-- sleep twitch

the 20% of 20% is the only information i have been able to obtain from them!!


sarah douglas | | Permalink

They must by law provide you with a CIS tax deduction certificate for any payments from the 6th to 5th each month, which should show you the breakdown .  Just a quick question regarding the formula was there Vat on your invoice as that could be part of your payment.   I suggest you ask them to send a copy of this as they must have it done by the 19th of each month.  You would need to net it back by the Vat rate first before you do the other formulae but you still need to know the labour and materials element

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