CIS Returns Leicester

CIS Returns LeicesterThe Construction Industry Scheme (CIS)  applies to help HMRC manage tax avoidance in the construction industry.

HMRC has set a very high level of compliance for contractors and sub-contractors.  CIS can be very burdensome.  Woodford Norman can provide expert advice on the scheme covering:

  • Registration
  • Gross payments status
  • Monthly returns
  • Employment status
  • General scheme compliance.

We can manage the CIS for you and we offer a friendly, professional service, competitive prices.

Most people in the construction industry are aware that failure to comply with the regulations  will result in harsh penalties and it is very difficult to get HMRC to take into account any mitigating circumstances.

A key part of the CIS is that the contractor has to make a monthly declaration that they have considered the status of the subcontractors and are satisfied that none of those listed on the return are employees. HMRC can impose a penalty of up to £3,000 if contractors negligently or deliberately provide incorrect information.

Remember that employment status is not a matter of choice. The circumstances of the engagement determine how it is treated.

HMRC have been making robust efforts to re-classify as many subcontractors as possible as employees. They have felt that too many have been claiming to be self employed for tax benefit purposes, but are in fact really employees.  HMRC have asked the courts to consider a large  number of cases in recent years.  They have challenged people on a variety of different factors. The tests which are applied to decide whether or not a worker is employed or self-employed include:

  • who manages how, what, where and when the work is carried out.  They will argue that the more control a contractor exercises is likely to indicate that the worker is an employee
  • does the person provides a personal or unique service or could a substitute be provided to do that same work
  • if equipment is required to do the job,  who provides it the contractor or the person doing the work –  if the contractor provides the tools then the person is likely to be an employee
  • how is the person paid.  are they hourly/weekly rate is paid, is there any overtime, sick or holiday pay.  Also is are invoices raised for the work done
  • is the worker performing a task in a self contained manner or is it part and parcel of the contractors business
  • is there any any written statement that indicates an employment relationship
  • is there an ongoing understanding that the contractor will offer work and the worker accept it
  • if the workers have any financial risk or is it all with the primary contractor.

If you are starting out as a contractor / sub-contractor, or are an established business, it makes sense to talk to us.

Call Woodford Norman on 0116 2886689 to find how they can provide you with a premier CIS returns Leicester service.

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