CIS Registration means Paperwork, guidelines, finances… everywhere. In case you’re having a hard time trying to figure everything out on your own, you’re at the right place and at the right time. We’re sure that you didn’t want to become a contractor or a subcontractor to deal with paperwork and finances now and then. CIS (Construction Industry Scheme) might become hard and stressful sometimes so we’re here to help you on your journey. Sit back and continue reading everything you need to know, from CIS scheme registration to all benefits this insures you. Let professionals like us lead you to success. It all starts with getting informed at the right place.
In order of making sure everything goes well, you need registration as the first crucial step. CIS registration scheme applies to sole traders, partnerships, or companies which work in the construction industry. CIS construction registration is considered an HMRC (HM Revenue & Customs) scheme. It’s one of the most crucial steps as it ensures you different kinds of benefits that make your work easier. But where do you start? In general terms, you need all the documents that provide more information about you or your business. This includes your national insurance number, the legal name for your business, your VAT registered number, and the unique taxpayer reference number (UTFR) of your business. It is important to make sure you give the right details and information to register for CIS as false registrations lead you to fines and different penalties.
How to do CIS Registration?
As a subcontractor, in case you’re paid by a building contractor for doing your work in CIS, you need to get registered for HMRC. This is an easy step and you have some different options on how to do so. The easiest one to follow includes visiting ‘Government Gateway’ online and you can call the helpline to continue with the procedure if this all seems overwhelming to you. All you have to do is give some personal information for verification, your UTR number (in case of registering as a company/business), or your VAT number (if you’re VAT registered). If you have a turnover that exceeds £30,000, you can register for the Gross Payment Scheme. Both these options are easy procedures that are followed online. All you have to do is chose the one that fits you or your company better.
By giving out the right information and UTR number for verification, you make it easier for yourself to get paid correctly by contractors. This happens because contractors have to make deductions of the standard rate of 20% once you’re registered for CIS and you’re also verified. That’s why it is also important to make sure you give the correct legal name of your business if you don’t, contractors can make deductions of 30%. And in case you have or want to be registered for Gross payment status, you should keep in mind that your contractor can’t make deductions from your payments as you pay your tax and national insurance by the end of the year.
If none of what we mentioned relates to you and you want to register under CIS for another type of business, continue reading here. This includes an easy-to-follow procedure. You have to keep in mind that HMRC registers partnerships separately from your sole trade registration. The procedure of registration is online for partnerships or limited companies. Gather all the needed information and continue with registering. You have to keep in mind that you must still register a company for CIS even if you’re abroad. This applies to businesses or companies outside the UK that do construction work as contractors or subcontractors within the UK. You should register a company for CIS if all construction work done is within 3 years.
What do you need to know regarding CIS contractor registration?
Everything works according to the rules you have to follow. This applies to CIS registration scheme as well. You should keep in mind some important details to avoid dealing with bigger problems later on. One of the first things is that you should make sure you’re registered for CIS before taking any subcontractor to do the work for you. This is important and you should not forget to make sure that you subcontract the work in the right way to avoid penalties. Before dealing with any subcontractor you must check with HMRC if they’re registered or not. Once you do so, be careful about payments and other processes. Everything you do or change needs to be recorded as you may get a penalty for not keeping CIS records. Even if all these seem unimportant you must not forget any of them. Never forget to let HMRC know about any change you do to your business.
When it comes to paying your subcontractors you should check everything carefully. Most of the cases include making deductions from their payments to pay the money to HMRC. Deductions are made based on the rules we mentioned earlier so you have to check carefully to avoid mistakes on the payments. This is important for both parties as all deductions made are considered payments done in advance towards the national insurance bill.
Benefits from being registered under CIS
By now we talked about CIS scheme registration, CIS company registration, and what you do once you’re registered for CIS but what do you gain from doing so? We gave you a detailed idea of how to do these things work so you understand the importance of everything. And luckily we’re not done yet. Once you’re registered under CIS you get a regular income. This is guaranteed and it will save you from nights of stress about getting paid for the work you do, especially as a self-employed person. You can easily talk about any complaint you have in case you haven’t gotten paid regularly. CIS tax registration is one of the biggest benefits. You don’t have to worry about being insured as by the deductions made to your payment everything goes to the National Insurance bill. This makes it easier to get covered and pay taxes.
CIS company registration or CIS registration is the best option that provides a better way of working and cooperation between contractors and subcontractors. It gives everyone many benefits and less stress. But if you’re still not sure about what and how to do it, we have more options for you.