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Post Info TOPIC: Posting Construction Industry Scheme sales invoices and receipts on Sage
Lilac Bookkeeping


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Posting Construction Industry Scheme sales invoices and receipts on Sage
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Hi

 

I have just taken on a new client that is self-employed CIS subcontractor.(will be changing to ltd co for tax year 2011-2012).

His sales invoices are gross but he receives funds net of tax via the CIS scheme but I am not sure how to process the entries on Sage.

I want to make sure the final accounts agree with what I should put on the tax return.

 

HELP!!



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gbm


Guru

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Hi Joanne,

There are a couple of ways of doing it. One of the easiest is to put through a credit note for the CIS.

Assume £1,000 of work, subject to CIS at 20%:

Gross invoice £1,000
dr debtors
cr work done

Credit note for £200 CIS
dr drawings
cr debtors

The net amount of £800 is the balance on the debtor account, and the CIS deducted in shown in drawings - it is his tax liability.

NB the situation for a ltd co will be different.

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Regards,
Nick

Website: www.gbmaccounts.co.uk
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Lilac Bookkeeping


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Thanks Nick

 

Sorry to be a thicko but what sage nominal account do you mean by work done? Sales -4000?



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