F.A.Q.

The Construction Industry Scheme (CIS) is a tax deduction scheme which involves tax being deducted at source from payments which relate to construction work.

No. CIS applies to self-employed individuals, who work in the Construction Industry.

Income taxes and NI contributions for employees, who work in the Construction Industry, are deducted from their wages during the year on the payroll basis.

Usually, HMRC contacts self-employed individuals with the request to pay National Insurance Contributions (NIC) as well as to provide an annual Tax Return.

HMRC contacts employees just when informing about their Tax Code.

0% (gross) tax rate will apply if the subcontractor passes three criteria:

• The subcontractor must carry out construction work in the UK, and the business must be run mainly   through  a bank account.
• Turnover from construction work must be at least £30,000 after VAT;
• The subcontractor must have complied with all tax obligations.

20% net applies when business is registered with HMRC.
30% net applies when business is not registrered with HMRC.

Tax Refunds usually take 1-4 weeks. It is important to provide accurate details as any discrepancies with the information held on HMRC database may delay the recovery process

The period for claiming a tax refund currently is 4 years. Tax return is also possible for those who no longer live in UK.

1. The fastest way to rebate your overpaid taxes is to fill a Tax Application Form which is available on our website.

2. Contact us. We can send you paper forms, which you will be required to fill out and return to us by post or email together with the scanned document copies.

3. Come to our office, where you’ll be able to fill the required forms and provide the documents for the Tax refund.

Self-Assessment involves completing a tax return each year. Self-employed individuals show their income and capital gains (profits on the sale of certain assets) as well as their business related expenses on their tax return declaration and can claim tax allowances or reliefs from their tax return.

All registered as self-employed are issued with a Unique Tax Reference ten digit number (UTR). This can be found on your tax return, most correspondence from HMRC.

UTR is issued by HMRC and it usually takes 4-8 weeks to get one.

An annual tax return must be completed by:

• Self-employed individuals;
• Company directors;
• Individuals with annual income of £100,000 and higher;

The above is just the list of most common cases when Tax Return has to be submitted. Please contact us for more information.

The deadline for submitting Tax Returns is the 31st of Januray.

The balance of any tax owed, must be paid by 31st of January following the end of the tax year. 31st of July is the date when individuals may have to pay the second 'payment on account' towards their next tax bill.

From the 31st of January 2012, the HMRC tightened their penalties for late Tax Return submissions and eliminated the possibility of penalty cancelation. If you fail to submit your Tax Return:

• One day late – the penalty will be £100;
• More than 3 months - £10 for each day together with the sum, mentioned above;
• More than 6 months - £300 or 5% of the tax amount, depends which one is higher, together with the sums, mentioned above.

These penalties apply:

• Even if your income for the last tax year was very low and you do not owe any taxes to HMRC;
• Even if you overpaid taxes and you are entitled to the tax refund.

If you are late to pay your income taxes, the HMRC will calculate the interest of your income taxes.

The HMRC suggests keeping all the records and documentation (such as invoices, receipts, bank statements, dividend vouchers etc.) of your Tax Returns for the last 6 years. In case of a tax enquiry, the HMRC has right to penalise you for not keeping and providing tax return documentation.

The HMRC has the right to open a tax enquiry within 12 months after the Tax Return submission date. If the HMRC discovers any inaccuracy, the enquiry can be extended up to 6 years. If the HMRC suspects any scam or money laundering, the enquiry can be extended up to 20 years.

The shareholders have to provide a chosen name for the company, the personal details of the director to be and the value of the shares. The company can be set up in 1 day.

Klevas Consulting mediates in limited companies’ formation, even if the shareholders live abroad. We provide consultations and services related to company’s financial and accountancy affairs. With the help of technology, communication with our clients is possible worldwide. By trusting and leaving all accountancy work to Klevas Consulting, our clients are able to devote to the development of their business only.

Value Added Tax is a tax levied on goods and services. A business with the annual turnover of £82,000 must register for VAT. The company registered for VAT is able to claim back VAT for business related expenses and, in this way, save some money. The VAT law is strict and complicated. Those who fail to follow it are penalised with high penalties. Klevas Consulting provides consultations on VAT affairs, prepares and submits the VAT declarations to the HMRC within the time limits.

Businesses which are not registered for VAT cannot charge it as they are not expected to pay VAT.

As a business owner, you can employ employees. PAYE (pay as you earn) and NI (National Insurance) are taxes levied on the salary you pay to your employees. Klevas Consulting provides consultations related to Payroll affairs: prepares payslips, calculates PAYE and NI taxes, prepares annual declarations and submits them to the HMRC.

Companies are obliged to submit:

• Annual Corporation Tax (CT) declaration;
• VAT declaration every three months (if registered for VAT);
• PAYE and NI declaration.

Corporation Tax is the tax charged on the profits of the company. Currently the CT in the UK is 20%.

Accountancy education and experience is needed in order to manage a company’s accounting correctly. Klevas Consulting provides valuable consultations and advice on bookkeeping and accounting affairs as well as represents clients in the dispute of tax enquiry with the HMRC.

The service price of Klevas Consulting varies depending on every individual company’s activities, business area, business development, volume and etc. The annual accountancy service contract is signed after the discussion and evaluation of each company’s specific needs and desires. The agreed amount is divided into equal monthly payments and is paid by direct debit.