Laura Williams

Hi there, I’m having a little trouble with the application of CIS deductions in the Eco industry. I am the Finance Manager for an eco installer. We install energy saving measures in domestic properties across the UK. We make the appropriate CIS deduction from our labourers and prior to us achieving Gross status we were subject to CIS deductions from our funders when we submit our jobs for payment. Our funders (the energy companies) pay us a rate per ABS score for each property where we install energy saving measures. So based on the size and type of the property, it’s pre main heating source and then the measures we install, there will be a jump in SAP band for the property before the install and after. and this jump will determine the ABS score. We are essentially trading carbon. We will sign a contract for a certain amount of ABS with each of our funders for the year and we are then obligated to deliver this amount of carbon by carrying out these installations. So to me the CIS still applies as there are construction works involved. The issue I’m having is we are acting as a managing agent for some installers like ourselves who aren’t fortunate enough to have secured their own funding. They have their own jobs and installers and will complete the job and just deliver through us to one of our funders. We get paid as we normally would do and we pay them, taking off a small fee. Essentially acting as a managing agent. On previous guidance from HMRC I am making CIS deductions from these payments to the sub installers. Which I believe to be correct as if they aren’t gross status and were submitting directly to the utility companies themselves, they would be subject to CIS deductions. I get resistance on this every month with every sub installer and just needed to confirm once and for all that my understanding is correct and that I’m applying the cis rules and guidance correctly. I think part of the problem could be that these companies are smaller than us and have never had a contract in place direct with utility companies and they keep coming back to me with “we are just trading carbon” One last week sent me a link to section 6.17 of CIS340 on managing agents. However this reads as though it is referring to property letting rather than a generalisation of acting as a managing agent in different scenarios. Am I correct on this? I’d be grateful for any input on this as it seems to be a bit of a grey area within the industry. Thanks in advance Laura

Hi There, I'm hoping someone can shed some light on this for me as it seems to be a bit of a grey area within the ECO industry. So I work for a contractor in the ECO Sector. We install energy saving measures in domestic properties under the governments ECO4 scheme. The customers do not pay, its fully funded for eligible customers through the scheme. We sub contract the labour out for the installation and make the necessary CIS deductions from their pay. We then put a submission through to the funder (in this case we have direct contracts for carbon delivery with 3 of the big energy companies) The job will have what we call and ABS score after we have made the energy improvements to the property and the funders will pay us a contracted rate per ABS. This is what call trading carbon. We are currently Gross Status for CIS however when we were at standard rate some the funders (energy companies) would make the necessary CIS deductions from our payments. We also used managing agents in the past - some have made CIS deductions and some have not. The part I need further clarification on is this. We currently have companies like ourselves that have leads but no contracted delivery / funding. So they cant put their carbon anywhere. So we are now acting as a managing agent for them. The install their own jobs, pay their installers accordingly and then submit them to us, and we deliver them to one of our funders the same way we would submit our own jobs for payment. The energy company pays us and then we issue a request for invoice to the sub installer with the jobs and ABS scores at their contracted rate with us. They invoice us and we pay them. Am I correct to be making CIS deductions from these payments the same way we would suffer them had we not have achieved gross status? My understanding of CIS is that it is the responsibility of the end contractor to make the necessary CIS deductions. If we would be subject to CIS deductions from the funder surely that is to be passed down to the sub installer? One of the sub installers has referred me to section 6.17 of CIS 340 that talks about "managing agents" but its seems to relate specifically to lettings. Am I correct in thinking if it was a generalisation of the rule it would state so? All I want is for us to be compliant for audit purposes, whichever way this lands. If anyone has any links to guidance or articles that may help id be grateful. Thanks Laura

Hi There, If you refer to section 2.7 in the link below - Windows and doors arent included in the zero rated list. Section 2.10 expands on insulation it does not state doors here either. The only mention of "door" in this guidance is where the "Draught Stripping" states that it is fitted around a door. Therefore, id be inclined to say it should be treated as 20% https://www.gov.uk/guidance/vat-on-energy-saving-materials-and-heating-equipment-notice-7086 Hope this helps!

Hi All, We have some unpaid supplier invoices going back as far as september 2023. They're on the ledger but in dispute as the wholesaler cannot provide proof of delivery. I believe there's a rule whereby she should be crediting out any invoices older than 6 months old that we have not paid, but I cannot find any HMRC guidance on this topic. Would someone be able to shed some light / share the link? Thanks :)