We shall discuss various registrations needed briefly through the below points:
Corporation Tax
Every company needs to register with HMRC for Corporation Tax, you basically need to inform them about your trading start date. They will then send you a 10 digits UTR (Unique Taxpayer Reference), which is needed while submitting annual company tax return CT600.
PAYE (Payroll)
We strongly recommend all companies to register for PAYE, especially if they do not have any employees. With the recent changes in the tax-free dividend threshold going down, payroll stands to be the only and most tax efficient way of taking out money from the company for personal use.
VAT
Every company which has/expects to have a vatable turnover of above £85,000 shall register for VAT immediately. Once you are registered for VAT, you need to charge VAT from all your customers and pay the same to HMRC, before doing that you may claim the benefit of the VAT you have already paid on your purchases. You also need to file VAT return to HMRC on a regular basis. From 1st April 2019, MTD will be applicable andall such businesses need to maintain their bookkeeping records online on an HMRC recognised software.
CIS
CIS registration is mandatory for people falling under the purview of construction industry scheme. You can be either of the 2:
CIS contractor
is the one who sub-contracts some work and pays out money to CIS sub-contractors. As per HMRC rules, such contractor must register as CIS contractor, deduct a certain percentage of such money (20% for the ones registered with HMRC, otherwise 30%) and then report (with CIS300 monthly return) and pay the same to HMRC.
CIS sub-contractor
shall register with HMRC in order to ensure a lower rated deduction i.e. 20%. Such deduction can be claimed back from HMRC only if they run payroll on a regular basis and submit such amount deducted through an EPS on a monthly basis.
A person can be both a contractor as well as a sub-contractor at the same time, in which case such person needs to comply with both the above set of rules.