If you're a limited company and a subcontractor and you've requested a refund of CIS deductions suffered from HMRC, you should record any money received in Sage 50 Accounts to update your bank and CIS Tax Withheld nominal codes. 

TIP: You can claim refunds of CIS deductions suffered using the HMRC online form. Read more >

You record this refund in a few quick steps. Let's go through them now:

1. On the navigation bar click Bank accounts then click Bank receipt.
2. Enter details of the income tax refund, for example:

   Bank	Date	N/C	Details	Net	T/C	VAT
   Bank nominal code	Date of receipt	CIS Tax Withheld, 2151 by default	CIS Tax Recoverable	40.00	T9	0.00

3. Click Save then click Close.

 NOTE: CIS Tax is included as part of your Income Tax. If you receive an Income Tax bill rather than a refund, you must post a bank payment rather than a bank receipt. In some instances, HMRC may advise to reduce your next payment to them rather than send you a refund. If you're a Limited company, you can reduce your PAYE and NI liability figure by the value of the CIS tax withheld. In this instance you must post a journal between the CIS Tax Withheld and PAYE or NI Liability nominal codes to offset the balances. If you're not sure whether to reduce the PAYE or the NI liability, please contact HMRC. If you're a sole trader, offset the balance on the CIS Tax Withheld nominal code against your self assessment tax calculation.