CIS pain on behalf of sole trader - how to record it

KMB
KMB Registered Posts: 4 New contributor ?
I am setting up the books for a sole trader and one of the people he is contracted to work with is paying CIS tax on his behalf. How will this be shown in the ledgers to keep track of it correctly? They pay him for labour, materials and VAT, but also deduct the CIS tax off the amount which they pay. Thanks.

Comments

  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 ? ? ?
    Cr sales full amount of invoice.

    Payment received:

    Dr Bank, Cr Debtors with amount paid
    CIS tax:
    Dr Tax deducted (misc account - put it to Equity/capital) Cr Debtors to clear the sales ledger.
  • KMB
    KMB Registered Posts: 4 New contributor ?
    That's great, thanks vedry much:001_smile:
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