VW Taxation Ltd
CIS Refund Services
For those who work under the Construction Industry Scheme (CIS), an overpayment of tax during the year is almost always inevitable. What is even better about CIS tax returns are the benefits that come with CIS deductions, which can greatly increase your claim back if you properly document and include all of the eligible expenses you have accumulated throughout the tax year.
CIS refunds are not always guaranteed, and most of these situations come from faulty tax documentation when the time comes to submit CIS HMRC forms. This guide will explore exactly what a Construction Industry Scheme refund is and the best processes to take to ensure you get a tax refund, which is almost always assured when you are working under CIS.
Read on to learn more.
What Is a CIS Refund?
For any subcontractor working in the construction industry, you are not necessarily required to register for CIS, however, you are required to fill out and submit a CIS tax return for each tax year. If you choose not to register with CIS, then the government will tax your income at source at a rate of 30%.
If you do choose to register as a subcontractor, HMRC will tax your payments at 20%. Either way, you will end up overpaying a good deal of tax each year, even more than a regular employee under the PAYE system, who are given the cushion of a personal allowance by the government.
How Do I Get My CIS Refund?
To get your tax refund, you will first have to fill out and submit a CIS tax return to HMRC. This is done by filling out a Self Assessment tax return where you will document all of the tax you have paid to HMRC throughout the year, as well as a complete list of all of your expenses throughout the year, which can then be calculated into deductions.
When the time comes to file your tax return, you will need to create an account with HMRC, where you will need to provide your UTR number and national insurance number for verification purposes. If you operate as a CIS limited company, you will also need to provide the unique taxpayer reference number for your business.
How Long Does a CIS Refund Take?
It typically takes HMRC 10 to 14 days to process CIS tax returns. This is due to additional security checks that may need to be performed to ensure all of the proper procedures have taken place in accordance with CIS guidelines, however we have seen some refunds processed in as quick as 6 days.
However, if all of the proper information is contained on the tax return, a tax specialist can typically have a CIS return filed within 24-48 hours. The length of time for getting your refund can vary based mostly on the time of year you submit your CIS tax return, but generally your rebate can be obtained within two weeks.
As previously mentioned, filing online and providing bank information for deposits is certainly going to be the fastest and most secure way to receive your refund.
How Do I Claim Back CIS as a Subcontractor?
The process for getting your tax back can vary based on how accurate HMRC has been in keeping track of all the tax you paid. Since CIS requires the tax to be immediately withheld at the source, HMRC receives the tax shortly after, which is similar to how the process works under the PAYE system.
Contractors will give you a monthly statement of what they’ve paid you and the deductions they’ve made to help with your accounting. So, the system is very time-consuming and a bit exhausting to keep track of.
Keeping track of all your statements, expenses, and possible deductions is crucial to get the tax refund you deserve for CIS tax. You are already paying a very high rate of taxes throughout the year, therefore, making sure that you can get some of this overpayment back, as well as optimising the best collection of all of your expenses throughout the year with verifiable records is always going to be easier and more comprehensive when using the services of a tax specialist.
Why Choose VW Taxation?
Although you do not need the services of a tax specialist or accountant to file your CIS tax return, we can assure you that every deduction you qualify for will be properly documented and submitted with your tax return for CIS. We will also ensure that your CIS tax return is properly filed to avoid any penalty, such as late filing.
Allow our CIS tax specialists to optimise the maximum refund capacity available to you. We will always strive to give you all the information that comes with the process every step of the way.
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Tell us how we can help with all of your CIS refund questions. We will return your request for information in a timely and helpful manner and our consultations are always free.