Guides and information

CIS Worked Example

To illustrate how the construction industry operates a worked example follows:

Bob works as a subcontractor on a building site run by ABC Ltd, and earns £2,000 per month.

Before paying Bob, ABC Ltd will deduct 20% of his earnings and will pay him the remainder, in this example £1,600.  The £400 that is deducted is then paid to HMRC by ABC Ltd.

At the end of the tax year Bob will employ Suretax to file his self assessment.

At that point Bob will supply details and supporting evidence of all of the expenses he is intending to claim for.  Suretax will then calculate Bob’s income tax liability based on his grossed up earnings, minus all expenses that qualify.  Bob will be entitled to a rebate that is the difference between what he actually owes, and what ABC Ltd has deducted through CIS .

In most cases the tax liability will be much lower and potential rebates could be thousands of pounds.

The rebate is usually processed very quickly once the self assessment has been filed.

Get in touch today
Contact Us

Request a free call
from an accountant

Submit the form and one of our friendly accountants will reach out to you within one working day.
By completing this form, I have read and acknowledged the Privacy Policy and agree that Suretax may contact me at the email address or phone number above.
Thank you! Your call back request has been received!

We'll be in touch shortly.
Oops! Something went wrong while submitting your call back request.