If you’re a limited company subcontractor, or an agent of a limited company, and you’ve paid too much tax or National Insurance you can claim a repayment (rebate) of your Construction Industry Scheme deductions.
A CIS tax refund is claimed using your Self Assessment tax return form. You will have to complete a tax return to be able to reclaim your CIS tax refund from HMRC. Then, if you are owed a refund, HMRC will repay this to you through your preferred method selected on your return form.
Need help? At Blue Rocket Accounting we can file your tax return online so that you'll be able to get your CIS tax rebate quickly with minimal fuss and delay. If you’re interested in finding out more, get in touch today via our website contact form or call us on 01322 555442.
You must act now so that we can meet the 31st January deadline
What is Self Assessment for CIS?
Taxpayers who are not paid through PAYE employment must complete an annual Self Assessment tax return so that HMRC know how much income tax to collect from them.
If you are a self-employed subcontractor under CIS (Construction Industry Scheme), you will need to include how much you have invoiced out during the year and all your allowable expenses when completing your tax return.
Once your tax return is received and processed by HMRC, your tax record will be updated and reflect how much tax you owe HMRC or how much is owed back to you, your rebate.
What are allowable expenses for subcontractors?
It can be tricky to know which expenses are allowable for tax purposes. An accountant will be able to help you with this, they can also complete the tax return on your behalf so you can be confident it is complete, correct and that you have claimed for every allowable expense to which you’re entitled. Knowing what expenses are allowable can help you to reduce your tax liability and/or increase any repayment due.
Below is a list of expense types which you may be able to claim the associated costs for:
- Materials, equipment, tools etc. Including maintenance and insurance costs for such.
- Protective clothing. Such as goggles, helmets, steel-capped boots and high visibility garments. You can also claim the costs for the cleaning of these.
- Travel costs. This includes a proportion of your motor expenses or alternatively it may be more beneficial to claim the calculated mileage allowance.
- Home office costs. If you use your home for work purposes such as preparing quotes, invoices or completing paperwork you can claim a proportion of these costs, an accountant can help you calculate this accurately. Alternatively, you can claim a flat £10 per month if you work from home for 25 hours or more per month.
- Phone, stationery etc. You can claim the business proportion of phone and internet costs plus stationery costs for business supplies e.g. printer cartridges.
When should I register for Self Assessment?
If you are an existing CIS scheme member, you will most likely be familiar with completing your Self Assessment tax return.
However, if you are new to the scheme you need to allow time to register via gov.uk.
To register, you will need:
- your legal business name - you can also give a trading name if it’s different to your business name
- your National Insurance Number
- the unique taxpayer reference number (UTR) for your business
- your VAT registration number (if you’re VAT registered)
If you do not have a UTR, register as a new business for Self Assessment and choose ‘working as a subcontractor’ when prompted. You’ll be registered for Self Assessment and CIS at the same time.
When is the deadline for a CIS tax return?
The deadline for a paper tax return submission is midnight, 31st October. However, if you have trouble meeting this deadline or have missed it altogether, you still have until midnight 31st January to file an online tax return. This is when HMRC must receive your Self Assessment tax return and payment of your tax bill if you owe them tax.
How long does it take to receive a CIS tax refund?
It usually takes between five days and eight weeks to get your refund once your tax return is submitted. The timescale can vary and does depends largely on HMRC security checks, procedures and whether it as an extra busy time of year for them.
If you have a preferred payment method such as BACS bank transfer, you will need to request this on your tax return.
This can all be quite a lot to take on board, and find the time for. Therefore, if you’d like Blue Rocket Accounting to manage this on your behalf, please get in touch.
Our team of expert accountants will work with you to ensure we have everything needed to file your CIS Self Assessment Tax Return on your behalf and make sure you get your CIS tax rebate as soon as possible. No stress. No missed deadlines.
If you’re interested in finding out more, get in touch today via our website contact form or call us on 01322 555442.
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