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CIS monthly declaration

CIS monthly declaration

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My client who is a contractor does his own monthly CIS declarations using HMRC online services.

He pays his subcontractors on the 30/31st of each month. Then he submits the return by the 5th of the following month.

He noticed that the confirmations he prints out from HMRC are not very clear and I also got confused...

eg: he paid his subcontractor on the 31st of Jan. Submitted CIS monthly return on 05/02/2014 and submission receipt says: CIS monthly return for January 2014 was successfully submitted.

However the monthly return printed out has got a heading: return for period ending 05/01/2014.

Is he doing it right? Or monthly payment to a contractor on 31/01/2014 should be a monthly return for February. What would be the submission deadline?

Thank you!

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By stratty
11th Mar 2014 13:21

Payment Dates

For CIS the payment date is the tax point so payments on 30th/31st of the month would fall in that tax month.   i.e. 31st January falls within 6th January to 5th February so go on 5th February return.

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By Yvonnel_b
11th Mar 2014 13:30

So payment on 31st of Jan should go on the CIS monthly return for February?

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By stratty
11th Mar 2014 13:33

Correct.

Payments on 31st Jan should be declared on the CIS return to 5th Feb.

 

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Euan's picture
By Euan MacLennan
11th Mar 2014 13:36

Agreed

Payments on 30th/31st January fall within the tax month to 5th February.  The deadline for filing the CIS300 return would be 19th February and the deadline for paying over the tax electronically would be (the last working day up to) the 22nd February.

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By Yvonnel_b
11th Mar 2014 13:43

So he does it wrong...

He took his first subcontractor on in the middle of October. Paid him 31/10/2013 and submitted declaration for October on 05/11/2013.

Do you suggest he corrects it all now or skips March and submits payment made on 31/03/2014 on his April statement ( there will not be a March return)?

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RLI
By lionofludesch
11th Mar 2014 13:59

There would be a March return - but it would be a nil return.

I'd probably suggest the client holds his hands up to the error and blame the confusing headings on the CIS website.  It does indeed say in some places "Return for January" and in others, "Month Ended 5th February".

So when did he pay the tax ?  If he pays a subcontractor on 31st January, how does he enter that on the return for 5th January, due by 19th ?   Or are they all late ?

If they're late, I'd be appealing against the penalties on the grounds that the HMRC website is confusing.  I'd be confident of getting them cancelled too.

 

 

 

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Euan's picture
By Euan MacLennan
11th Mar 2014 14:01

If he has been doing it wrong ...

... every month since October, I am surprised that he has not been hit with penalties for late filing.  If he entered the payment on 31.10.13 on a return for the month to 05.10.13 and did not file it until 05.11.13, it was after the filing deadline of 19.10.13 and therefore late.  If he hasn't been penalised, he may be doing it right.

I have never used the HMRC CIS Online service, but the print-out of the CIS300 return in Moneysoft for a payment on 31.10.13 (or even on 05.11.13) would be headed "Oct-13" while referring in the text to "Month end for this return: 05 11 2013".

I wish they would do away with tax months and years and just use calendar months and years for tax!

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By Yvonnel_b
11th Mar 2014 14:13

Yes - the heading on the HMRC is misleading...

He has not got any penalties/letters from HMRC yet...

He pays his subcontractors on 31 Jan, submits monthly return for January ( I know it shall be for Feb) on 05th of Feb and I think he pays the tax on the same day.

Do you suggest he shall stay quiet, submit NIL return for March and get it right from the new tax year?

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By stratty
11th Mar 2014 14:28

CIS Fixes

The incorrect submission of subcontractor payments may impact on those subcontractors when accounts are prepared and Self Assessment is submitted.  It is best for this situation to be rectified in order to avoid any future problems.

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