The Issue
Under the new Construction Industry Scheme (CIS), thousands of tradespeople all around
the UK are trusting employers and contractors to deduct tax from their earnings and pay it to
HMRC on their behalf.
However, as J. Jervis Accounting Services recently found out, not all contractors are staying
true to their obligations.
This was the case for one of their clients who had been working with a contractor for a
number of years under a CIS agreement. This meant that despite the contractor deducting
the tax rate from their payslip every month, they weren’t paying HMRC.
Although this could be seen as a mistake, this had been going on for years and several
people were affected by the same negligence.
In total, the contractor skimmed more than £500,000 from people’s pay before anyone
noticed. What’s more, because HMRC was unaware of what was happening, it continues to
pursue the client for the unpaid tax bill.
The Solution
J. Jervis Accounting Services were able to help their client by going through their accounts
over the past few years. In doing so, they determined just how much tax they had paid
against how much was required over the same period and found that their client had been
paying significantly more tax than necessary - despite receiving threatening letters from
HMRC.
To the client’s astonishment, they were eligible to claim for more than £20,000 as a tax
rebate, not to mention the potential damages they may be able to claim against the
contractor that wronged them.
The Legacy
As well as reassessing years worth of accounts and helping them claim a significant rebate,
J. Jervis Accounting Services helped their client digitise their books.
Not only will this help protect the client from overpaying their taxes in the future, it will also
save them a great deal of time when it comes to filing their tax return and keeping on top of
their expenses.

Moreover, HMRC’s Making Tax Digital initiative will soon bring fundamental changes to the
tax system. This means VAT-registered businesses with a taxable turnover below £85,000
will be required to follow certain rules for their first return starting on or after April 2022.
Essentially, this means that businesses will need to start using digital accounting software as
of April 2021.
Such online platforms are not only affordable, they save time and give sole traders the
space to focus on their business. What’s more, is they provide simple and easy-to-use tools
to help track business performance.
About
Based in Wrexham, J.Jervis Accounting Services provides bookkeeping services for small
businesses. They also help introduce their clients to the world of digital bookkeeping and
implementing cloud accounting such as Quickbooks, FreeAgent, Xero, Sage 50.
Clients of J.Jervis Accounting Services can also benefit from a range of how-to videos help
them get their accounting software up and running in no time.
Above all else, J.Jervis Accounting Services pride themselves on their approachability. They
don’t use confusing finance talk and they won’t charge you for a five-minute phone call.
Instead, they believe they have a duty to their clients to help them and their business thrive.
To find out if you’ve been paying too much tax, call them today on 01691 774431 or visit