CIS tax refund for companies

I own a small company in construction and some of our customers have been deducting CIS tax from our payments. How do I go about reclaiming this?

1st February 2014

When a contractor pays your company “under deduction” (i.e. net of tax) for work, it must give your company a statement showing the full amount of the payment and the deduction that it has made from that payment. 

You will need to enter these on your company's Employer Payment Summary (EPS) returns. The CIS deductions you have suffered will then be offset against the company’s PAYE liabilities for the year to date.

Limited companies that have an excess of CIS deductions, will not be able to claim a repayment of these until:

  • The final Full Payment Submission (FPS) for the year has been submitted (due by 19 April each year where payments to employees are made in the period 6 March to 5 April)
  • The company has paid all amounts due to HMRC for the tax year in their capacity as an employer/contractor
  • The tax year in which the CIS deductions were made from the company has ended

Please note, you should not attempt to claim any CIS credits on the company's Corporation Tax return as you may incur a penalty.

Your local TaxAssist Accountant would be happy to manage your CIS affairs or any other of your accounting or tax needs. Contact us to be put in touch with your local office.

By Jo Nockels

Disclaimer: Advice shared in this blog is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this forum, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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