T: 01277 236246

CIS Tax Rates and Deductions

When you begin work for a contractor they will ask for your name UTR and national insurance number. Once provided the contractor will need to ‘verify you’. This is a process they do either on line with the revenue or by phone.

You will be verified successfully if you have followed the above steps and registered within the construction industry. If verified correctly you will be deducted 20% tax from your wages.

If you can not be verified the contractor will deduct you 30% tax until you have registered within the scheme. However, you can still claim the 30% tax back at the end of the year.

We can help you to assess the rates and your deductions from 2011, 2010, 2009, 2008 & 2007.  We can also prepare for your 2012 tax returns.

National Insurance

As a self employed individual you are required to pay two rates of National Insurance

Please note that as self employed individuals you pay an overall lower rate of national insurance compared to an employed individual at is for this reason that if you attempt to claim Job seekers allowance at any point you may not be entitled to the benefit.

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  • Class 2 – Of £2.30 per week regardless of earnings. You can only gain exemption from this if you believe your earning will be below £5000 for the year. Class 2 national insurance can either be collected via direct debit or paid monthly upon receipt of a bill from the revenue.
  • Class 4 – At a rate of 8% of profits over £5715 up to a limit of £43875 where it will drop to 1%. This is collected through your tax return.

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CIS Tax Refunds
T: 01277 236246
E: info@sewellaccountants.com
2nd Floor Romy House, 163 to 167 Kings Road, Brentwood
Essex, CM14 4EG