CIS "netting off"

How do i “nett off” in cis deductions acc?

Are we talking about contractors deducting tax from subbies or subbies receiving payment less tax?

yes contractors deducting. ive set up a cis deductions account. i then input the subbies invoice in full then when its paid i go onto the invoice mark as paid from the cis account. then when the net payment shows on current account i tag this to cis acc then do the same with the payment to hmrc. but then i cant see how to tag a refund which is the last thing i need to do i believe in order to complete the whole transaction

In what respect would you be receiving a refund? If your a contractor you’d be paying over the withheld tax to hmrc. Why would they then refund you? Are you sure you are not confusing your own cis tax deductions with sub contractors withheld tax?

If you could clarify I would be able to help.

What type of account have you set up for the CIS deductions? The way it should work is that you put the gross amount of the invoice on and show the full debt due to the subbie. When you pay the subbie, you pay him net of tax, so tag the net amount to the invoice, leaving a balance on his account equivalent to the tax due. You then transfer this to the CIS liability account by raising a credit note on the supplier account and tagging it to the CIS liability. This means the CIS account should show the amount due to HMRC so that when you pay HMRC you can tag it here and clear the balance.

I was following the instructions given by quickfile under “cis deductions contractors”. It’s the very last step I need help with. The heading is NETTING OFF .could you explain this step to me in more detail

I agree. But op referred to refunds which has confused me.

ok, so the CIS account is a bank account. In which case entering a credit is effectively entering a payment which you tag to PAYE liability, judging by the article.

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