Construction Industry Scheme

System
System Posts: 100,537 🤖 Admin 🤖
edited June 9 in General accounting discussion
I have a client who has been working as a plumbing and heating engineer on a self-employed basis for the same 'contractor' for the past 12 months. Not only has the 'contractor' treated my client as self-employed and not employed, but he has not taken off any CIS deductions at all. Should I be doing anything about this?

Comments

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    If he hasn't had anything deducted but hasn't received any the benefits of being employed (holiday pay etc), it sounds very dodgy.

    The contractor is risking losing their CIS status by not operating the system correctly.

    As long as your client pays the correct amount of tax, he should be fine. However, if he holds a CIS4 is there any obligation on him to ensure all is done correctly? i.e. if he doesn't have any tax deducted from the payments he receives, is he obliged to query it with the contractor.

    Did you client show his card before he started work?

    All very dodgy!

    8)
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    When you say he has been working for the same Contractor for 12 months, has he been working for any other Contractors as well during that time?

    If not can the Contractor really class him as Self Employed?
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    We have subcontractors that work for us on the life of a contract which could span more than one year.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    This is exactly what HMRC are trying to stamp out - contractors paying subbies gross :D does your client have a CIS card? If so which one? Depending on the card, that is the rate that the contractor should be deducting tax at.

    Working for the same contractor is not at all unusual - I have got some bone fide subbies that have worked for the same contractor for many years.

    Claudia
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    Yes, he has a CIS4 card and has used it with previous contractors in previous years. However, this current contractor just hasn't bothered doing anything. Do you think my client is obliged to do anything about it?
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme


    This may well be a stupid question, but are you sure that the work he's doing definately falls under CIS?

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    No - just my question. I think he should be under PAYE, but he is not. So surely then he should be under CIS at the very least. He is under nothing at present!
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Construction Industry Scheme

    At the end of the day he has been paid what he has been paid - just do his accounts on that basis, warn him that it is not correct, warn him about the new CIS rules in April and cross your fingers :lol:

    Claudia

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