SolvedCOM125110 | Repayments/reallocations: non automatic repayments: repayment of CIS25 tax, responsible office
From HM Revenue & Customs · COTAX Manual
Companies who are subcontractors in the construction industry but are not certificated under Section 561 (S561) Income and Corporation Taxes Act (ICTA) 1988 suffer deductions of tax under S559(4) ICTA 1988. These deductions from payments made to them for construction operations are often referred to as CIS25 tax.
The CIS25 tax:
up to 5 April 2002 was set off against the CT liability of the company
on or after 6 April 2002 must not in the first instance be set against the CT liability. It should be used against any PAYE liability of the company. If any surplus remains that has not already been repaid via PAYE procedures then, and only at the request of the company, can it be treated as a repayment set-off against CT liability. The EDP to be given to these reallocations should be the date of agreement to the set-off
For more information see CISR76020 in the Construction Industry Scheme Reform Manual.
For CIS deductions suffered on or before 5 April 2002, a company could claim a repayment of any excess deductions of CIS in an original or amended CT600 return under Regulation 13(1) Security Integration (SI) 1975 No 1960.
It was not a statutory requirement that a return or amended return was used to obtain these repayments. HMRC accepted written requests, so long as the information supplied was clear and sufficient. However, for CTSA periods, a company could not claim a repayment of CIS deductions under Taxes Management Act (TMA70) /S59DA until the company delivered its return.
You can use function DSET (District Set Off) to create the relevant posting on the Accounting Period (AP) record or records and function DIRR (District Repayment) to process the repayment.
Repayment interest may be payable.
See: