How much of a builder's invoice reaches the bank? That is the practical question. CIS works like a holding account, not a fine. One unverified labour payment of £1,000 keeps £300 (30%) with HMRC until Self Assessment or the company tax return reconciles it. The same pattern over a year locks up a much larger… Continue reading CIS Deductions Explained: Rates, Returns and Cash Flow
Tag: CIS subcontractor
CIS Subcontractor Returns Explained for UK Contractors
A sole-trader electrician sends a main contractor an invoice for £1,200. The bank payment that arrives is £1,080, and the remittance advice shows a CIS deduction. Nothing appears to be wrong with the invoice, but £120 has been withheld, leaving the subcontractor unsure whether the contractor made an error or whether HMRC has taken the… Continue reading CIS Subcontractor Returns Explained for UK Contractors