Here we explain how to:

• Apply CIS deductions to sales invoices for your CIS contractors
• Apply reverse charge VAT to sales invoices for your CIS contractors

• Set up CIS for your business to make sure the correct CIS ledger accounts are added to your chart of accounts
• Set up your CIS contacts as contractors
• CIS deductions are only calculated on invoices where a CIS Labour ledger account is used
• The CIS deduction is applied to the net amount of the CIS labour, exclusive of VAT

Create a CIS sales invoice

1. Select Sales and then Sales Invoices.
2. Select New Invoice.
3. Choose a contact that is set up for CIS (once selected, you'll see a blue banner advising your contact is set up for CIS and CIS deductions will apply to your invoice).

4. If applicable, select Use Reverse Charge VAT.

   When to use reverse charge VAT

   Reverse charge VAT should get applied to invoices where you're supplying services under the CIS scheme. Read more about VAT domestic reverse charge for building and construction services.

   Remember that the reverse charge applies to theses services plus any construction materials used directly for those services.

5. Enter your labour charge on a separate line.
   • Make sure you select the CIS labour ledger account to ensure your CIS is recorded correctly
   • CIS deductions are only taken from lines recorded against a CIS Labour ledger account
   • If you’ve set a default on your contact, this will be selected automatically
   • If you need to apply a discount, use a separate line and record the figure as a neagtive value

6. Enter any CIS Materials on a separate line. Choose a CIS Materials ledger account.

7. Your invoice will show the total charges for the labour and materials, the CIS deductions and where applicable, the VAT being amount being reversed.

8. Once you're happy with your invoice, select Save.

 NOTE: If you are unable to complete these steps and raise the correct CIS invoice, you may not have saved your CIS settings. You'll need to check your CIS settings again. 

CIS quotes and estimates

• Reverse charge VAT can be applied to the quote or estimate
• CIS deductions are only applied when the quote or estimate is converted to an invoice

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