# Payroll help Required

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Registered Posts: 170 Dedicated contributor 🦉
I have 2 questions and I am hoping someone here can help.

Firstly, CIS Returns, I am about to complete my first one and wondered; Do I use the Net figure where it says "Actual payment made to subcontractor"? (as opposed to gross) I assume that it is the net figure but wanted to check first.

Secondly, Holiday Calculations. A member of staff starts work on 21st March and leaves on 6th August. They are contracted to work 25 hours over 5 days, however she averagely works 30 hours per week. She had a couple of weeks unpaid leave during that time making the average come out around 27 hours a week. I make it 20 weeks employment.

So 5.6 weeks x 20/52 = 2.15 weeks holiday
Or 28 days x 20/52 = 10.77 days holiday

Even if I take the hours worked in total, this is 475 x 12.07%, I get 57.33 hours.

Acas have told my client that she is entitled to 6 days? I am confused by this, does anyone else get 6 days?????

Thanks

• Registered Posts: 2,453 Beyond epic contributor 🧙‍♂️
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475/2080 x 28 = 6,4 days rounded down to 6?

475 is total hours worked.
2080 is 40 hours per week times 52.
28 days is what you give.

I'm not sure if that's correct or not, it's what I would do on Dutch payroll calculations. I would have kept it in hours though, rather than days, as she doesn't work 8 hours a day.

No clue about the CIS figure though, sorry.
• Registered Posts: 170 Dedicated contributor 🦉
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Thanks

I have never seen it calculated that way before!
• Registered Posts: 170 Dedicated contributor 🦉
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Rinske, Can I ask why you use 40 hours?

If I take her weekly hours of 25 x 52 = 1300 then do 475/1300 x 28 = 10.23, which is the figure I came up with originally.
• Registered Posts: 2,453 Beyond epic contributor 🧙‍♂️
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40 hours is full time hours.

As said, it's based on Dutch calculations and might be horribly wrong for English payroll.

But I would work it out pro rata. A full time week is 40 hours and she works only part of that, so she only builds up part of the holiday for a full time week. At the same time taking a week's worth of holiday would take her less hours, so if someone would be working a full year, she still gets the same amount of holiday.

We always did it that way, because if someone works part time and not the same amount of hours every day, they would take holiday in hours rather than days and legally the build up would be done over the actual hours worked, pro rata to a full time year.

Not sure if I explain this clear, but as said, I haven't done any English payroll, so I can't say if it is done in the same way or not, but I think it's slightly different.
• Registered Posts: 170 Dedicated contributor 🦉
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Thanks Rinske

Does anyone else have any thoughts on this???? No offense Rinske, just want some more opinions!
• Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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CIS is my field. Your question, what figure to enter. You enter the total paid to the sub-contractor less the VAT, then you put the materials deducted in the materials column and finally the amount of tax deducted. If you need any more help with the monthly returns or the payment statements etc, give me a pm.
• Registered Posts: 2,453 Beyond epic contributor 🧙‍♂️
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zara5034 wrote: »
Thanks Rinske

Does anyone else have any thoughts on this???? No offense Rinske, just want some more opinions!
No offense taken!

By all means, I am terribly aware that there are different ways of calculating it between different countries, and I'm actually very interested to see if it will be correct or not.
• Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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T.C. wrote: »
CIS is my field. Your question, what figure to enter. You enter the total paid to the sub-contractor less the VAT,

Gross, or net pay after CIS tax?
I would interpret 'total paid' as net, which is what I do, but I am never sure if it is right.
• Registered Posts: 495 Dedicated contributor 🦉
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CIS - You must put the Gross excl VAT in the first box. If not the subcontractors may have difficulty claiming any refunds due as there income won;t match the contractors.

I know this as I spent a lot of time correcting returns submitted by a member of staff who had entered the net figure in the first box.
• Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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Thanks Groundy.
Last time I double checked, I was told net.
*sigh*
• Registered Posts: 170 Dedicated contributor 🦉
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I Don't believe it! I checked with someone else who did many CIS returns and she said to use the Net figure! I've done the return now. Shall I phone up the helpline? Like Monsoon said, It said the amount actually paid to the subbie so I also interpreted it as Net, it's not very clear though.

Does anyone else have any thoughts on the holiday calculation?
• Registered Posts: 1,002 Beyond epic contributor 🧙‍♂️
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Yip, I've been doing CIS returns for years and agree with groundy... it's the original amount on the invoice for labour and materials before VAT is added or CIS is deducted that they're after.
I would suggest that you ring the helpline - if there's no change to the CIS figure then I'm pretty sure they'll just amend it over the phone for you. I know I've had something similar amended over the phone but I can't remember exactly what it was.

And as for the payroll, I asked a similar question a few days ago which Payroll Pro & Monsoon answered, may be of use to you
• Registered Posts: 1,624 Beyond epic contributor 🧙‍♂️
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Maybe people are getting confused with net of vat and net of CIS tax?

However I agree with Groundy,Jodie and T.C. net of vat but Inc tax on return.
• Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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I'd love to know where I got net of tax from. Sigh. Thanks all!
• Registered Posts: 118 Dedicated contributor 🦉
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Hi guys,

Sorry to put a spanner in the work. What is in the contract of employment regarding holidays?
If the employee is contracted to 25 hours but works 30 hours this could be classed as overtime and overtime doesn't accrued holidays.

CIS, the first box is the gross payment made to the sub-contractor less vat. The second box is the cost of materials used if any and the third box is the amount of tax deducted. eg. if a subby is paid £120 and £20 is material the amount box 1, £120, box 2,£20 and box 3, £20. If there are no materials box 1 would be £120 and box 3 would be £24.00.

http://www.hmrc.gov.uk/manuals/cisrmanual/Pdfs/cis300.pdf This file say use gross.

Babs
• Registered Posts: 170 Dedicated contributor 🦉
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Thanks Babsa

Your CIS help is easiest to understand that I have seen! I think you should re-write the HMRC manuals.

And thanks for the holiday pay advice, I have checked Business link and have also spoken to ACAS, I am definitely calculating it correct, ACAS have come up with the same calculation as me, so I have no idea where the 6 days comes from that my client says ACAS quoted her, I may phone them whilst with the client to make sure we're all clear as she may have given ACAS different information.

I think the thing that upset me the most was being accused of being wrong. I don't think some employers realise how much holidays employees are entitled to these days.

• Registered Posts: 118 Dedicated contributor 🦉
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Hi Zara,
Thank you for the compliment.
Babs
• Registered Posts: 118 Dedicated contributor 🦉
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AAT have a number of events covering CIS coming up in the autumn.

Branch events;

· 6 September - Milton Keynes – CIS and the construction industry

· 12 November – South Wales - Payroll CIS and employment law - joint event with CIMA

Mastercourses;

· 21 October – York - AM: Employer compliance PM: CIS compliance for contractors

· 29 October - - London - AM: Employer compliance PM: CIS compliance for contractors

· 21 November - - Bristol AM: Employer compliance PM: CIS compliance for contractors
• Registered Posts: 170 Dedicated contributor 🦉
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Ooh thanks

Shame I live in Cornwall, could possibly do the south Wales one!