London, UK (PRWEB) February 22, 2013
A study by RIFT UK, tax refund specialists, has found a major shift in the way construction companies are looking to pay workers across the country, with a significant number of employers choosing to move their employees on to the Construction Industry Scheme (CIS), meaning that these workers become technically self-employed.
RIFT, the tax refund specialists within the construction industry, are seeing first-hand the confusion caused when workers move into a new way of working and, ultimately, a new way of being paid and taxed. They specialise in being able to help clients who are being moved away from being “on the books” to being paid though the CIS Scheme. Below are addressed some of the key issues CIS employees are coming across on a daily basis.
1. Workers moving onto the Construction Industry Scheme are now classed as self-employed, meaning workers will be expected to complete a tax return every year. If they miss the deadline they could face a fine of up to £1600, even if they owed no tax at all.
2. Workers need to register with HMRC on the CIS scheme. This will ensure they are taxed at a standard rate of 20% on your income. If the registration is done incorrectly, contractors will deduct 30% tax from your pay.
3. CIS Workers will lose their tax free allowance. This means all pay is taxed at a standard rate – meaning when a tax return is completed at the end of the year, workers will most likely have a refund owed.
4. Workers now need to keep a record of all expenses. This is to ensure they are refunded everything they are entitled to, meaning those on CIS should keep receipts for any expenses such as tools, telephone bills, specialist clothing, as well as keep a log of all your travel, which will likely be the biggest expense. RIFT’s valuable Little Black Log Book helps workers keep a track of any such costs every day – then, once the book is returned to them, they do the rest to work out what workers are due.
RIFT tax refund’s specialist CIS team have been helping construction workers for over 14 years, and have developed the expertise to maximise their refund - over 98% of RIFT’s CIS clients get an average refund of £1510. They are available to answer any questions construction workers might have and maintain contact throughout the year. Just head to http://www.riftuk.com or phone 01233 628 648 to find out more.