Join C.I.S or not...

J.D. Landscaping · Jan 13, 2010

Hi All,

Earlier this year I carried out some work for a firm, who deducted the tax at source 20% I think...

Would registering for the scheme be of benefit to my co.

I'm a Sole trader, and we do a fair bit of subcontracting, I normally just pass on the UTR and nothing more is said.

However, if I registred, would it be advantageous in regards getting larger scale contracts etc, or is it just more unneeded paperwork ?

Many thanks

Dave

Zeno · Jan 13, 2010

You do not have a choice as to "join" the CIS scheme. If your work falls within it then your contractors should be deducting the tax.

You may like to speak to your accountant to get this clarified. Most major contractors will not touch you without the correct registrations.

David Griffiths · Jan 13, 2010

You are already registered as a subcontractor, otherwise the main contractor would not have been able to pay you.

The only other option that you have is to apply for gross payment status so that the main contractor doesn't have to deduct tax. There are certain tests be be passed to get this status - see here and scroll down.

If you get gross status, then you have to keep all tax payments up to date, or they'll take it away.

Some contractors prefer to deal with gross payment subbies - has this ever been an issue for you?

J.D. Landscaping · Jan 13, 2010

David Griffiths said:
You are already registered as a subcontractor, otherwise the main contractor would not have been able to pay you.

The only other option that you have is to apply for gross payment status so that the main contractor doesn't have to deduct tax. There are certain tests be be passed to get this status - see here and scroll down.

If you get gross status, then you have to keep all tax payments up to date, or they'll take it away.

Some contractors prefer to deal with gross payment subbies - has this ever been an issue for you?

Never been a problem so far.

As for your first line of advice, Does that mean, i am already registered on the C.I.S Scheme and don't need to do anything further ?

Many Thanks

David Griffiths · Jan 13, 2010

J.D. Landscaping said:
As for your first line of advice, Does that mean, i am already registered on the C.I.S Scheme and don't need to do anything further ?

Many Thanks

Yes. The contractor wouldn't be allowed to pay you at all if you hadn't registered as a subcontractor. It may be that you (or somebody else) has done this in the last three years, or perhaps as you had subcontract income prior to April 2007 it was carried over automatically to the new scheme.

I presume that you don't make payments to other contractors for construction work? That would mean that you'd have to register as a contractor (as well as a subcontractor) and jump through all sorts of hoops, including making monthly returns.

J.D. Landscaping · Jan 13, 2010

David Griffiths said:
Yes. The contractor wouldn't be allowed to pay you at all if you hadn't registered as a subcontractor. It may be that you (or somebody else) has done this in the last three years, or perhaps as you had subcontract income prior to April 2007 it was carried over automatically to the new scheme.

I presume that you don't make payments to other contractors for construction work? That would mean that you'd have to register as a contractor (as well as a subcontractor) and jump through all sorts of hoops, including making monthly returns.

I haven't had to do that as of yet, no.

Many Thanks

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