FAQ’s
How do you determine which solution is best for me?
There has been a large volume of non-tax-case-law, which has provided principles to help determine if there is genuinely is a contract of employment. HMRC provide some guidance based on these principles;
- The degree of control exercised by the engager
- The financial risk taken by the worker
- Whether the worker has other engagements at the same time
- Whether the worker got the job through a tendering process
- Whether the worker provides their own plant and equipment
- Whether the worker provides the materials needed to complete the job.
If you meet one or more of these principles, you can be classified as self-employed and you would register under the CIS and use our Construct service. If you would like one of our specialists to assess which solution would best suit your circumstances feel free to call us on 01253 600140.
What is the Construction Industry Scheme (CIS)?
The Construction Industry Scheme (CIS) sets out the rules for how payments to subcontractors for construction work must be handled by contractors in the construction industry. If you work within construction you have to register with the scheme or work for a business that is already registered.
How do I register?
You must contact HMRC on 08456070143 whom will then give you a Unique Tax Reference (UTR) number which we need to ensure you are taxed correctly, which could be 0%, 20% or 30%. Once established, we would make this deduction and pass on to HMRC on your behalf. At the end of the year, once you have completed a self assessment you may be due a refund.
What jobs fall under the CIS?
Some examples of the types of construction work that are covered by the scheme include jobs like:
- site preparation
- general construction - bricklaying, roofing, plastering and so on
- alterations and extensions
- repairs and refurbishment
- decorating
- dismantling work
- demolition
(HMRC, 2009)
Do I have to register with the CIS if I use the Danbro Umbrella?
No. Under the umbrella you are effectively an employee of Danbro and thus are subject to PAYE and NICs on your income. You have no obligations relating to the CIS whatsoever.
What are the main benefits of operating as self-employed under the CIS?
As a self-employed individual you are not subject to Employers National Insurance at 12.8% which saves you a considerable amount of money.
Working through an agency or end client
We’re happy to deal with both. Danbro alleviate the burden from agencies and end clients by managing CIS deductions and payments on their behalf. We want to ensure that both you and your agency/client receive minimal administration and total peace of mind.
How does Danbro Construct work?
Danbro is registered as a contractor under the CIS. We would effectively sub contract your skills to your agency or client and then invoice them for the work done. Once we receive the monies from them, we would make the CIS deduction and send the remaining net amount directly to your bank account. You can keep up-to-date with payments and deduction as we send out a statement of payment each time a payment is made to you.
How quickly am I paid?
As soon as we receive monies from your agency/client, we would send payment straight to your bank account less the CIS deduction, by BACS.
How much is the Danbro Construct service?
Danbro Construct costs £15 per week.
What National Insurance Contributions do I have to pay?
As a self-employed individual, you are required to pay the following National Insurance Contributions (which you must arrange);
Class 2: £2.40pw, which can be paid by direct debit to HMRC each week
Class 4: 8% of the net profit at the end of a tax year
Why do I have to do a self assessment tax return at the end of the year?
Self Assessment involves completing an online or paper tax return in order to tell HMRC about your income, or to claim tax allowances or reliefs against your tax bill. HMRC use the figures on the tax return to work out your tax bill. Thus, there is the possibility that you may be required to pay more tax, but on the flip side you may get a tax rebate.
Can Danbro help me with my self assessment?
Yes. We would be more than happy to help you with your self assessment for a small fee starting from £120.00.
Should I keep a track of all my expenses?
Yes. You can claim tax relief on business related expenses you have incurred throughout the year; however, you will need to provide evidence of these, hence the importance of keeping any receipts or documentation where possible.
If you would like more information, please feel free to call one of our dedicated consultants who are always happy to help, on 01253 600140.
For further details, please contact Danbro for Umbrella Service: 01253 600141, General Enquiries: 01253 600140, London Office: 020 7836 8400 or email enquiries@danbro.co.uk or send an enquiry.
