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Cis invoice example for Planning

welcome to another training session here 4-0 today we are going to be looking at the CIS now for those of you in the know you will know that 0 is about to release a CIS module later in this year hopefully by summer but in the interim how do you deal with CIS well there's two sides of CIS we need to consider the type where you are the contract or ie you have subcontractors and the type where you are the subcontractor reporting to a contractor now the first one we're going to consider is when you are a subcontractor working for a larger contractor in this instance the larger contractor will withhold a percentage and this can vary up to 30 percent from you for CIS and you need to record that accurately within your accounts in order to make your bank reconcile so the first thing you need to do is go to settings and chart of accounts so what we're going to do is set up a new chart of accounts now this will be within the debtors section because it will be money that's effectively over to you albeit you won't actually receive that until your taxes gee and we're going to give it a count code 732 in our instance now it doesn't matter which code you use if you just scroll down to the debtors section you can actually use any one for debtors from 600 or 700 we do 73 - just for this example so you click on add account account type will be current assets count carried 732 the name we're going to give it is other debtors CIS suffered you could say see is withheld but suffered is a terminology we use leave your v80 normal leave each of these as they are and click Save so that's the side you need to worry about there now obviously this side is decided it's linked to sales invoices so when you're actually raising a sales invoice and will raise one just to come ABC construction okay so you'd have the description of work carried out your big long description I'm saying what you've done a thousand pounds sales you then put one align the 4 cís suffered or without one and this is where you put your percentage so if you're twenty percent you can knock off 20% etc so we will put negative 200 so we're going to knock off 20% of the amount and we're going to put this to the CIS code so that means that your cells are still showing at the full amount but you are knocking off for 200 pounds so when you come to do your bank reconciliation and you receive 800 pounds you can reconcile it easily then click approve now that you've approved your own voice everything is done from this perspective you will see if you go to reports and balance sheet scroll down you can now see that you have two hundred pounds sat as Syria suffered I reclaim a ball when you set offset against your tax or your PA away next we need to move on to the other way around so if you are a contractor employing subcontractors now obviously you need to withhold money from them or be it 20 to them 30 percent or maybe nothing if they grow registered but usually 20 or 30% so we're going to work in a very similar way so if we go to Settings chart of accounts we're now going to add a liability or creditors account so if we go to add account current liability now we're going to use two code eight four six but you can use any eight hundred code that you've got spare we'll call it other creditors and we'll put C is withheld from subbies leave everything else the same and click Save again where it's in a very similar way you go to accounts and purchases and then you've got your new button and if we put X Y Zed contractors and have the subcontractors start working for you so they will bill you for wake down maybe a thousand pound again and that I'm going to purchase this and then you put C is withheld negative two hundred put it into the 8:06 code and approve and that's again done so if we now go to reports and balance sheet we can see that you've now got your 200 pound CIS suffered and you've got your two is here 200 pounds si is withheld from subbies just down here now obviously if you need to not work out the exact amount of CIS it's jus you would deduct one from the other say you would say what's been withheld from me 200 pounds what's been were powered from subcontractors I what do I owe to HMRC 200 pounds more than that effect is zero if it had been 20,000 pounds up here and 1000 pounds down here then the net effect would be 19 thousand pound due to you if it was the other way around where it said 1,000 pound up here and 20,000 pound down here then it would be a net effect of nineteen thousand pound owed to HMRC now hopefully you found that session useful it's a little bit complex and as I say zero will be releasing a CIS bolt on that really soon we've heard possibly as early as May but this is a workaround that will last you until then if you've got any questions please do contact us the telephone number is zero three three zero three three zero seven seven seven seven or just visit w-w-w camps calm