Star Payroll Professional software was one of the first major payroll packages to receive the Recognition Letter from HM Revenue & Customs (HMRC) for online filing of returns and verification requests under the CIS (Construction Industry Scheme) commencing 6 April 2007. This is official confirmation that Star Payroll Professional meets the requirements for online submission of monthly CIS returns (CIS 300) and verification requests over the internet.
Employers must complete a verification procedure before paying a sub-contractor and the payments are subject to specified tax rates. Employers are also required to file their monthly CIS returns over the internet.
Star Payroll Professional controls the entire process. When setting up an individual’s record in Star Payroll Professional, there is a choice as to whether the person has PAYE or sub-contractor status. In the case of a sub-contractor, a Unique Tax Reference is required and/or a National Insurance Number, before the payment amount can be entered. The record creation procedure automatically assigns an NT tax code and NI letter of X to the sub-contractor.
This means that sub-contractors and PAYE employees can be handled in the same datafile. This in turn means that employers can receive management reports that show sub-contractor and PAYE employee data both separately and combined.
All sub-contractor settings need to be verified with HRMC and the user is reminded of this as the record is being created. Once accepted, specific details of the trading status of the sub-contractor can be entered, such as sole trader, partnership, trust or company, together with associated information.
Verification of the sub-contractor can be made by telephone, manually on the HMRC website, or online by simply clicking on Star Payroll Professional’s Online Verification button and then stepping through the pages. Whichever method is used, the verification number and date is recorded and the appropriate tax is deducted on the next calculation.
