News
The New CIS Scheme
National Minimum Wage
| The New CIS Scheme |  |
The new CIS scheme came into effect 5 April 2007. The key change to the scheme is that there is now a verification process that each subcontractor must undergo in order to assess whether they are in the CIS scheme, and if so, what level of deduction should be made.
Each contractor should have received a list of subcontractors that they paid in the last year. If your subcontractor is not on the list then you still need to verify them, if they are, you are advised whether you should make deductions from them or not.
There are 3 different levels of payment.
1) 20% deduction (formerly 18%)
2) 30% deduction
3) Gross payment
If you subcontractor is verified and marked as net payment then you deduct 20% if they are marked for gross payment then no deduction is made and if your subcontractor is not verified then you should make the 30% deduction.
If you need to verify a new or existing subcontractor you should ring the CIS help line on 0845 366 7899 or you can do it online www.hmrc.gov.uk/new-cis.
!!! You must verify your subcontractor BEFORE you make any payments !!!
Please note that when completing the monthly return you will need to sign a declaration stating that all of your subcontractors are subcontractors and should not be employed by you. You must check the status of your subcontractors, please contact us for more information.
| National Minimum Wage | |
The national minimum wage was increased again on 1st October 2007
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22 and over from £5.35 to £5.52 per hour
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18-21 year olds from £4.45 to £4.60 per hour
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16-17 year olds from £3.30 to £3.40 per hour
The national minimum wage will increased again on 1st October 2008
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22 and over from £5.52 to £5.73 per hour
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18-21 year olds from £4.60 to £4.77 per hour
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16-17 year olds from £3.40 to £3.53 per hour
Accommodation offset - £4.46 per day (£31.22 per week).
The annual leave entitlement was also increased from 20 to 24 days a year for full time workers and will increase again to 28 days from April 2009
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