Limited Company CIS Tax
Limited company requests for CIS repayment must be made in writing at the end of the tax year, can not be made before.
If you are a subcontractor operating through your own limited company you will reclaim all of the CIS that has been deducted from your sales invoices at the end of the tax year. Until this point it sits on your Balance Sheet just like a debtor (someone who owes you money) and has no effect on your profit or loss or the corporation tax bill for the company.
Your corporation tax is calculated by taking your gross sales minus all expenses to give you your profit, this is then multiplied by the corporation tax rate – currently 20% for small companies. You do NOT offset CIS against corporation tax – CIS and corporation tax are totally different taxes. Understanding this is key to managing your tax affairs.
Limited company requests for CIS repayment must be made in writing at the end of the tax year, can not be made before. We will of course do this for you as part of our service.
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This information is for general information only. We take no responsibility for any action taken or refrained from in consequence of its contents. Always seek our professional advice specific to your circumstances before acting.