Overview of the CIS scheme and how it works with Accounting Start.
Set up CIS in Accounting Start so sales invoices calculate the CIS deduction.
If you're a subcontractor, record CIS for your customers and remain compliant
What you need to know
- The Construction Industry Scheme (CIS) is a HMRC tax requirement for contractors and subcontractors in the construction industry. See www.gov.uk/what-is-the-construction-industry-scheme
- If you're a contractor, you must register for the scheme.
- Under CIS, contractors deduct money from a payments received from subcontractor’s payments and pass it to HMRC. The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
- If you're a subcontractor you don’t have to register, but deductions are taken from your payments at a higher rate if you're not registered.
- If you want to import your own chart of accounts, you must do this before you activate CIS. Once activated, we create additional CIS ledger accounts and disable the import chart of accounts feature.
- If you're using Accounting Start, you can only use CIS if you are a subcontractor. This is because Start doesn’t support purchase invoices.
- Learn how to use the CIS feature if you currently enter CIS into the system manually
How it works in Accounting Start
Set up CIS and use special ledger accounts when recording transactions so CIS is deducted automatically.
Enter opening balances if you have just migrated from another system
CIS for subcontractors
- Identify which contacts are contractors so the correct deductions are applied to your transactions.
- Identify when contractors need to use reverse charge VAT.
When recording sales invoices, select a CIS ledger account and we'll automatically deduct the CIS amount withheld by your contractors.
- Create a CIS Suffered report, over any given period, to see track the deductions made on your behalf by your contractors.
- CIS opening balances
- Transitioning from manually recording CIS tax withheld to using the CIS feature