And possibly pay a payment on account every July, depending on their status. Coronavirus: Government Benefits for the Self-Employed >>, Home > Writing > Register a Business > How to Register as a CIS Subcontractor Online. Ensuring your tax return is submitted correctly and on time. preparing the site, eg laying foundations and providing access works, installing systems for heating, lighting, power, water and ventilation, cleaning the inside of buildings after construction work, a permanent or temporary building or structure, civil engineering work like roads and bridges, making materials used in construction including plant and machinery, work on construction sites that’s clearly not construction, eg running a canteen or site facilities. Privacy Statement | So when a subcontractor completes their tax return each year they can deduct for allowable expenses to reduce their tax bill, balance up how much tax has been deducted by the contractors they worked for and, for some, get a tax refund. Once you’ve completed the process, HMRC will send you a letter with the information you need to begin work as a CIS contractor. The CIS Scheme affects contractors who employ self-employed subcontractors. Our Services are designed to ensure you can reclaim any tax that is rightfully yours. Typical allowable expenses for CIS subcontractors include: It is really important to keep hold of receipts for all your expenses, not only is it a requirement of HMRC but it means you won’t forget to claim anything when tax time comes. This is determined by the service they will be providing, so you need to fully understand the work to be undertaken and the terms of engagement. Whether you are self-employed or a subcontractor, you’ll be required to: Before you register with HMRC as a subcontractor, it will help to check whether you need to register. It is a legal requirement and will make filling in your CIS tax return easy, so don’t lose them. Your first step is to register as a contractor. Set up your HMRC online account so you can manage your taxes online; Wait for your activation code so you can complete setup of your HMRC online account. Do You Need to Register as a Subcontractor? You can do this through the government’s website and need to register prior to starting any construction. Apart from this, the HMRC requirements are the same. If you use a trading name, enter it now for HMRC as well as your address. As a contractor you need to confirm each subbie’s employment status. Automatic deduction of 30% from your pay by the contractor you work for; An automatic penalty of £100 by HMRC for failing to register as self-employed; Further automatic penalties for failing to submit a self-assessment tax return forms; Penalties and tax estimates made by HMRC that you will need to pay unless you submit a self-assessment tax return. being self-employed and tax with a friendly and transparent customer experience. If you are unsure whether you need to register as a contractor, then call the HMRC CIS Helpline on 0300 200 3210 to discuss your situation. The information contained in this website is for guidance and information purposes only. Legal business name or trading name they gave when registering with CIS, National Insurance number if they’re a sole trader, Company registration number if they’re a limited company. This step-by-step guide to CIS registration online shows you what you need to do from start to finish to apply for your CIS card. If HMRC rule the status is wrong you cannot use this in your defence. Your first step is to register as a contractor. Payments can be made without any deduction in special circumstances, there’s more about “Gross Payment Status” later. Always pay your taxes and file your tax return on time to retain CIS gross payment status. than these.Tough have paid all your tax and National Insurance on time in the past; As part of your application to register as a subcontractor online; By calling the HMRC CIS Helpline on 0300 200 3210. Learn how to set up the financial side of your business with these easy to understand guides and resources: Anita Forrest is a Chartered Accountant, spreadsheet geek, money nerd and creator of www.goselfemployed.co - the UK small business finance blog for the self-employed community. If it is found that you are no longer eligible, your status will be removed and they will write to you to explain your decision. Are CIS Subcontractors Classed as Self-Employed? You’ll then need to complete the following steps: Keep your UTR number and login details for your HMRC online account safe. If you are already registered as self-employed, but need to register under the CIS scheme, you should contact the CIS Helpline – 0300 200 3210. We have helped over 150 youngsters climb the first rung of a successful career in construction, Over 65% of our business is through recommendation from our clients and business associates, Celebrating over twenty years of compliance, reliability and surety, This quick quiz could save your business from bankruptcy. Construction Scheme Industry is also known as ‘CIS’. You must make sure the contractor you are working for gives you a statement every single time they pay you. The deadline for 2019-20 Tax year is 31 Jan 2021. You have successfully joined our subscriber list. 94% of our CIS customers were paid back by HMRC in 2018/19. Simple, straight-forward advice to make self-employment topics like taxes, bookkeeping and banking easy to understand. Skip to Step 2 – How to Registered for CIS Online below and read more about gross payment status if you wish. Verifying CIS Subcontractor. Additional Bookkeeping £25 per hour. Simply chose the right level of service for you, sign up now and get your dedicated account manager to look after all your tax and HMRC affairs. 0845 643 5289, Your CIS financial risks are more than managed - they are eliminated, No set-up fees, no notice period - just pay as you go, CIS compliance is essential and with Hudson Contract it's guaranteed. Construction Indus try Scheme (CIS). HMRC will confirm the subbie is registered with CIS, and the rate of deduction you need to use. If you are already registered with HMRC and submit a tax return for another reason. You will need your self assessment Unique Tax Reference (UTR) number when you start work. There is a two-step process to Register as a Self-Employed CIS Subcontractor. All Rights Reserved. It is essentially a tax deduction paid over to HMRC on the subcontractor’s behalf. You’ll need to show that you: Your turnover must also be £30,000 if you are self-employed excluding: If you are eligible, you can apply for gross payment status: Your Gross Payment Status will be reviewed by HMRC every year. To register as a CIS subcontractor online you’ll need to: Choose whether you are registering for net or gross CIS payments (see below for more information on gross CIS payments). Did you know that over 30% of UK tax payers are eligible for a tax refund on training, paid subscriptions, uniforms or if they have ever worked with an emergency tax code? All the best. What is a CIS Payment and Deduction Statement? New Here? Contractors are legally required to deduct a fixed amount every time they pay a subcontractor. However be aware this tool is only an indication and is not definite.