About this time of year, we start getting calls and WhatsApp messages from clients wanting to know when they’ll get their construction industry scheme (CIS) refund from HMRC. And I don’t blame them.
At the end of the day, that’s your money – and it’s been sitting in HMRC’s bank account for months.
The short answer is that if your accountant knows what they’re doing, it should arrive in early April or normally 8-12 weeks from submission.
There you go, you don’t have to read on!
However, hear us out. There are some other things you need to consider, and it’s worth finding out that little bit more about CIS and the process.
How does the CIS process work
As soon as you submit your CIS return, we’ll get in touch with you to make sure all the information is tip top. Then we’ll send off the necessary information to HMRC.
If you needed a unique taxpayer reference (UTR) number and didn’t have one, this process can take 4-8 weeks, so it’s worth making sure you have your UTR before you file your CIS return.
Furthermore, the actual nitty-gritty of CIS refunds can get confusing.
There is a GOV.UK article that takes you through your CIS claim, but this is why we’re here. As your accountant, we can manage the process so you don’t get bogged down in the legal side and can focus on what’s important.
Are you CIS registered?
As a contractor, you must register for the CIS. Sounds dull, I know.
Most subcontractors also register for the CIS, because deductions are taken from their payments at a higher rate if they’re not. So, it ain’t worth not being registered.
If you’re a subcontractor and you receive any pay where tax has been deducted under the CIS scheme then this is you.
You’ll need a business or trading name, your National Insurance number, a UTR number and VAT number (if required).
Pretty much everything you do as a subcontractor is done through the CIS, but there are some exclusions if you only do certain things.
Carpet fitting, architecture and surveying, for example, all don’t require things to be done through the CIS. For pretty much everything else, you will have to.
So we say, get registered. It will make the whole process easier, deductions from your payments will be taken at a lower rate, and when you come to submit your CIS return, you’ll find that there is less legwork required.
A good time to build
Understanding CIS and what it means for you as a contractor or subcontractor is a great time to further your business’s reach.
Whether that be through proper planning, or looking at where your new tax-saving could be used to pump funds back into the business, there are some creative ways in which you can use your CIS refund.
Still unsure?
If it all still seems confusing, then no sweat. We’re happy to talk everything through at length with you on the phone if you need.If you want an accountant who’ll get on top of your CIS return and any refunds, give us a shout.