ChatterBank0 min ago
Cisco Payments Query.
3 Answers
My stepson found his first proper job last year which is self employed on the CIS scheme. I am trying to do his tax return for 2011/2012 which he has been putting off for months. He is paid fortnightly and his payslips are emailed to him by a firm that deals with the pay on behalf of his contractor. My stepson seems to think that he has to pay this payroll firm to pay him! Is this normal practise? I would have expected his contractor to be paying the firm to deal with all the pay of the subcontractors, not the subcontractors themselves. Also he has never had a bill and there are no obvious deductions on his payslip for this service. I keep asking him to find out but it falls on deaf ears! Also he is insistent he doesn't have to pay Class 4 NIC, he says all his workmates only pay £2.65 a week. I'm assuming that's is because that is what they pay out of their bank accounts and maybe they don't notice the extra deduction at the end of their tax return? I can't see any reason for my stepson to be exempt but he keeps protesting about it. I don't want to get it wrong! It's probably just a lack of confidence on my part. Maybe I'll tell him to find an accountant for the next one! TIA
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As far as I know, being registered under CIS doesn't change any of the 'rules' regarding normal self-employment (SE) - it just assures HMRC that deductions will be made from source earnings by the main contractor.
So one has to pay Class 2 NI, and Class 4 NI on the profit in the tax year. For 2012-13 the figures are 9% on profit between £7,605 and £42,475, and 2% on any profit over that amount.
This payroll contractor sounds like a 'managing agent' who is working on behalf of the main contractor and is employed by the MC to deal with all the CIS-subbie related issues. So, no, one wouldn't be expecting to pay him.
There is a specific Helpline for CIS - why not phone them with your queries? 0845 366 7899
So one has to pay Class 2 NI, and Class 4 NI on the profit in the tax year. For 2012-13 the figures are 9% on profit between £7,605 and £42,475, and 2% on any profit over that amount.
This payroll contractor sounds like a 'managing agent' who is working on behalf of the main contractor and is employed by the MC to deal with all the CIS-subbie related issues. So, no, one wouldn't be expecting to pay him.
There is a specific Helpline for CIS - why not phone them with your queries? 0845 366 7899
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