Under the Construction Industry Scheme (CIS), contractors deduct money from a subcontractor’s payments and pass it to HM Revenue and Customs (HMRC).
The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
Contractors must register for the scheme. Subcontractors don’t have to register, but deductions are taken from their payments at a higher rate if they’re not registered.
HMRC make it easy to join CIS but its hard to find the instructions on how to leave or cancel CIS.
For those who have struggled to find the instructions here they are
If you stop trading or using subcontractors
stop filing monthly CIS reports
Do this even if you’ve stopped using subcontractors temporarily, for example because you’re using your own employees to carry out work.
In general I find a letter works best as you can send it recorded delivery and prove it was sent, you write to this address
National Insurance Contributions and Employers Office
HM Revenue and Customs
In the next few weeks and months many small businesses will leave the VAT Flat Rate Scheme.
The reason why Flat Rate is going see an exodus is because of Low or Limited cost traders will see their Flat Rate increased to 16.5% in April.
So for example
If your sales are £5,000, the VAT is £1,000, total £6,000 x 16.5% = £990 VAT payable, so HMRC have let you keep £10!
It is highly likely that almost every trader will have input tax higher than £10 so therefore there is no point in being in the Flat Rate Scheme.
How to leave
You can choose to leave the scheme at any time.
To leave, write to HMRC and they will confirm your leaving date.
HM Revenue and Customs
77 Victoria Street
Ask your accountant if you need help.
Before the vote we had lots of warnings:
- Job Losses
- Emergency Budget
- Exchange rates crisis
- Stock Market crash
- Trade Deal problems (back of the queue!)
- House Price Boom expected to end and house prices will fall 18%
- £30bn of tax increases
- Increased fuel prices
- The cost of using mobiles in Europe could increase
- EU Travel will cost more
I have to say it felt like everyday there would be a new and bigger more extreme warning of impending doom.
I think the Remain Camp over did the disaster stories and that lost them credibility.
The Leave Campaigners put forward a much better argument as demonstrated in this movie
So what happens next
So far ….
David Cameron has resigned and his successor is widely tipped to be Boris Johnson.
The Labour Leader Jeremy Corbyn has had a number of key members of the shadow cabinet resign and there could be a leadership challenge
The Scottish parliament want to veto the Britain’s Exit which could lead to Scotland having another vote on independence
Its expected that it will take up to 2 years to exit the EU and the UK vote could lead other countries to consider referendums
Its going to be a bumpy ride so prepare yourself now!