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Timing of LTD CIS rebates

Timing of LTD CIS rebates

LTD CIS rebate due, year-end 31/03 but accounts not ready yet (likely to be a month or so).

Would you:

1) Start the refund process now, asking for the full balance to be credited to the CT account, then request a refund from the CT account (if due) once the CT600 has gone in?  (can CT be refunded online like through the dashboard like you can with Self Assessment?  Never checked...)

2) Hold fire until the CT600 has gone in, offset the exact amount for CT and request the difference back?

3) Request a full refund immediately and settle the CT balance at a later date?

I've always gone with 2 but given the delays surrounding CIS with LTD's i'm wondering if 1 might be the easier solution?

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By SJRUK
20th Apr 2015 13:34

3 for me. 

There is a danger that the refund is not received before the CT is due if you go by number 2 and with number 1 the Revenue will be holding onto the tax 9 months before they are owed, so it might as well be in your bank account.

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By BKD
20th Apr 2015 14:08


3 is the correct answer. There is no right of offset against CT - unless you're talking about an unpaid CT liability. Get the cash now while you can.

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20th Apr 2015 14:11

Repayment

Assuming that the final EPS for CIS suffered in 2014/15 has been filed, you should write immediately to the Longbenton address to request repayment.  According to the CIS Helpcard, HMRC is hoping to process the repayments within 5 weeks - why wait 9 months?

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20th Apr 2015 14:14

Interesting

Can you back that up in the regs ?  I only ask because I've specifically been told in the past that only the excess over the CT liability would be repaid and no repayment would be made until the CT600 for the relevant period had been filed.

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By BKD
20th Apr 2015 14:28

Reg 56(6)

.

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20th Apr 2015 14:44

Thank you

Appreciated

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20th Apr 2015 21:05

Option 3

The reason i've never gone with that before is the fear of the clients spending the money - I know half of them too well, it's the exact same reason I won't let any of them apply for gross status.

 

Re option 1 - is it easy to request a CT overpayment much in the same way you'd request one for Self Assessment?

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By Matrix
20th Apr 2015 21:15

You have to tell the PAYE office how much to allocate to CT and they then hand this over to the HMRC office with the reference you give for CT.  I suppose you could then get a refund if the amount allocated is higher than the CT liability, HMRC just refund the excess after the due date.

I had a client who once spent it after I slogged to get it back (pre RTI) and then never paid the CT.  So I see your point, HMRC do not make any option easy.

 

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20th Apr 2015 21:45

@Matrix
"HMRC just refund the excess after the due date"

Is that definitely correct? If so, that's probably not the best course of action then, wouldn't want any excess being held up for 6+ months because of my own preference.

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By Matrix
20th Apr 2015 22:14

No it is a best guess

Well the usual way of obtaining a CIS refund is through the PAYE system, not the CT system and if the CT office has been told to offset the PAYE overpayment against CT then I don't know how quickly they would refund it.

If you will have accounts in a month then just offset actual CT and get a refund for the rest. 

 

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By Spriggy
22nd Apr 2015 14:02

I have always gone with 3 and this year is no exception.  It is easier this year because once the final submissions have been made under RTI for 2014/15 the value of the expected refund can be checked by phone using the Employers Helpline.  I did this yesterday and apart from 1) a false start due to the machine misinterpretting what I had said and putting me through to Self Assessment and 2)   a 25 minute wait to speak to a person once I had redialled, it was pretty plain sailing.  The refund figure was agreed and the refund will be received by the end of May.

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By Spriggy
22nd Apr 2015 14:09

Registered as a subcontractor - - - - or not?

Has anyone come across this one?  When I phoned the Employeres Helpline to obtain a refund for one of my clients I was told my figures were agreed but HMRC couldn't refund as the company (Ltd) was not registered as a subcontractor.  I pointed out that since it started 5 years ago the company had alwaysbeen both contractor and subcontractor.  Also, if the company was not registered as a subcontractor how come it was being deducted tax on payments at 20% under the CIS scheme?  The HMRC man was adamant and I had to get the Director of the company to reregister the company.  What nonsense is that?

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