Any help on CIS payment?

[coolcatkelso]

Hi guys

Just got an invoice in from a builder (sub contractor)

Its a mixed invoice, so no idea what am doing in terms of cis.

Sub total - £797.20
Vat - £159.44
Total £956.64

Am I right in thinking :-

797.20 - 20% Cis = £637.76 Cis payment (159.44)

637.76 + Vat at £159.44 = Paid to sub £797.20?

Its actually got more complicated than that as his original estimate was for £2500, I added on 30% to the client (council ) and when the council paid me, they had already removed the cis from me and the subs, so no idea how that will work. Will he get to claim back a bigger amount than stated above?

 

[Newboy]

Assuming that the £797.20 is all labour then your calculation is correct

 

[Newboy]

The CIS deduction from your invoice will come back to you at the end of the tax year when you do your return. You will have effectively overpaid tax so it will reduce your tax liability. Your subbie will only have the statement of deduction from you showing £159.44 as tax taken under CIS.

 

[coolcatkelso]

Hi, its a mixed invoice, not broken down to labour and materials, invoice simply shows 727.20 sub
159.44 vat
And total

 

[Newboy]

Strictly speaking, you need the labour element broken out but if it isn't split then it's wiser to deduct CIS on the full (net) value

 

[coolcatkelso]

So net value being the 727.20?

 

[Newboy]

yes