My self employed client has recently become a subcontractor under the CIS scheme. He has not raised any invoices to the company he has been working for but i have a remit off them showing how much they have paid him and how much CIS has been deducted.
Should i advise my client to raise a sales invoices? Also, how would I record this in Sage Line 50? He is also VAT registered on standard VAT scheme. Its the first time ive come across CIS as a subcontractor...
Yes, raise an invoice to the main contractor, put labour and material costs on the invoice because if CIS is to be deducted, they will need this to work out how much to deduct, usually 20% deduction from labour.
In Sage, i deal with CIS by setting up a seperate CIS Receivable account in the bank module, when payment is received normally minus the 20% CIS, i receipt it the normal way into the bank.
When the deduction statement is then received from the main contractor, the deduction is then receipted into the CIS receivable account, this will then clear the customer account.
