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New Ltd company CIS help

How to deal with CIS deductions on income using quickbooks.

My husband is starting a ltd company in the construction industry. He will be purchasing plant and operating it himself. Everything we invoice is subject to 20% deductions (CIS). 

I’ve set him up as an employee and director, taking a  modest salary and he will receive dividends. I am submitting the FPS weekly as he is paid weekly and the EPS we will do monthly.

Quickbooks has a setting to deal with te CIS suffered but I want to make sure we’re not missing anything?

I’m AAT qualified and work as an accounts assistant for a large restaurant company, so I have an understanding of accounts but CIS is not really my field. 

Should we hire an accountant or is this something I can manage myself?

Any help or advice appreciated. 


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14th Aug 2018 21:21

You're 'just about' qualifying for a reply here:) - Thanks to your AAT.

You certainly do not need an accountant to do your bookkeeping, especially for Director only LTD business. You do, however, need an accountant to assist your husband's company with other matters, like taxes, statutory accounts, etc.

To answer your question:
First step would be to post the invoice in full on QB. CR Sales , DR SLCA

Second step: Once you receive the payment from the main contractor, Debit bank and CR SLCA. Obviously, there will be a shortfall of 20%

Third step: The 'unpaid 20%' credit off to CIS nominal. As a result, SLCA should equal NIL and there should be a DR balance in the balance sheet n/c for CIS which normally will be the repayment unless you decide to pay a monthly salary in excess of £700 which would generate NIC due.

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By RedFive
15th Aug 2018 07:40

There are advantages and disadvantages to switching on CIS in QBO.

If cis subbie only and not cis contractor then I wouldn’t bother.

I don’t for most of my clients as use Moneysoft for CIS300 returns if contractor and reiterate above post with only difference being I post the cis as a credit note to the customer account using a ‘cis suffered 2018/19’ nominal code with no vat. This will need to be created in your COA in the Accounting tab if not switching cis on.

Your cis suffered nominal will then give you a nice running total to be used when claiming it back / asking to offset against CT (online application now) at tax year end.

Not a pitch as I only deal with local clients but I would charge circa £90+vat per month to do all QB bookkeeping except raising of sales invoices plus annual confirmation statement, accounts, CT600, all queries with HMRC, claiming back cis, Director payroll, etc.

Worth considering a good local Accountant to help you navigate some potential choppy waters ahead given you have a full time day job?

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15th Aug 2018 11:42

The CIS on Quickbooks work well. I would switch it on and the CIS deduction to the CIS Suffered Account in the balance sheet on QBO

You can file the EPS when you run the payroll for your husband

Then you can claim a CIS refund online or offset it against the corporation tax bill.

If you can you may try to go for Gross Status instead

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15th Aug 2018 11:51

We've got CIS enabled on quickbooks and we've got a 'CIS suffered' account showing us our running total. We don't have anyone working for us so it's only on what we're invoicing.
I think I may be best to speak to an accountant and just deal with the more basic stuff myself. Thanks for everyone's help

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