A step by step guide to completing your Annual Return Form CITB trading as CITB-Construction Skills Northern Ireland

Transcription

1 CITB-ConstructionSkills NI 2011 Levy Return Guidance Notes A step by step guide to completing your Annual Return Form CITB trading as CITB-Construction Skills Northern Ireland

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3 Important Notice to Levy Payers Levy CITB-ConstructionSkills NI is a statutory training board with the purpose of encouraging the adequate training of persons employed in or intending to be employed in the construction industry in Northern Ireland. Consequently CITB- ConstructionSkills NI provides a wide range of services including training advice and guidance on training grants. As it is considered that your business activity or a portion of your business activity is within scope as defined by Schedule 1 of the Industrial Training Board Order 1964, CITB-ConstructionSkills NI need to determine if you will be required to pay a training levy and, if so, the amount. The legislation requires you to complete the Annual Return Form to enable us to calculate your levy and as a result you are respectfully asked to complete the Annual Return Form and forward it to CITB-ConstructionSkills NI by not later than 5.00pm on 31 August For the forty-seventh levy period, (1 September 2011 to 31 August 2012) the levy will be 0.6% of the total of all emoluments paid by you for construction work in Northern Ireland to employees and self employed labour only subcontractors who are not themselves levy payers. The levy threshold for the training year 1 September 2011 to 31 August 2012 will remain at 80,000. Please note that if you fail to complete the Annual Return Form, CITB- ConstructionSkills NI has the right to estimate your emoluments for the relevant tax year. CITB-ConstructionSkills NI also has the right to inspect emoluments for up to 5 years or from the date of registration, which ever is the greater. As a result of the introduction in April 2007 of the new HM Revenue & Customs (HMRC) CIS Scheme, you are advised to keep copies of all monthly returns made to HMRC as CITB-ConstructionSkills NI is required by law to examine these. You are asked to note that for the purposes of interpretation the term business is deemed to include Limited Companies, Partnerships, Limited Liability Partnerships, Sole Traders or any other persons involved in any commercial enterprise or activity within construction as defined in the Industrial Training (NI) Order

4 Definitions Emoluments are gross wages paid in the relevant tax year to PAYE and subcontractors. Working Directors are directors who make executive decisions in the Board Room, and take an active part in decision making and are involved in the day to day running of the business. Supply & Fit Contractors CITB-ConstructionSkills NI determine a supply and fit contractor to be a contractor who supplies materials representing 10% or more of the value of the contract. Please note if this is the case you should not include any of the payment i.e. materials or labour, in your calculations when completing your Annual Return form. Main Activity is the activity which you would spend most time involved in. Secondary Activity is an activity which you would be involved in frequently but would not take up the majority of your time. Construction Establishment is a construction activity which is operating in Northern Ireland for a period of 27 or more weeks in the tax year ended April Levy Threshold The limit at which levy becomes payable. Currently 80,000 of total emoluments. Interest Charge To facilitate the timely recovery of levy for the purpose of investment in training, interest will be charged on all overdue levy raised in the forthcoming training year (Levy Period 47). With effect from 1 October 2011, interest at a rate of 8% gross per annum will be calculated from the date upon which accounts become overdue (30 days after levy assessment has been raised) up to the date of payment. Barry Neilson Chief Executive CITB-ConstructionSkills NI Nutts Corner Training Centre, 17 Dundrod Road Crumlin, Co Antrim, BT29 4SR. Tel:

5 Points to Remember when Completing the Annual Return Annual Return must be completed and returned before 5.00pm on 31 August 2011 Options will not be accepted after 5.00pm on 31 August 2011 under any circumstances Annual Returns can be completed online at on or before 31 August 2011 User Name and Password for online Return can be found on the front of the 2011 Annual Return or you can contact CITB-ConstructionSkills NI for these details If your company trading name has changed please make sure you amend the details on the Annual Return Emoluments to be included should be the Gross emoluments to PAYE and Labour Only Subcontractors relating to construction in NI Do not include payments made for work undertaken outside Northern Ireland Exclude payments to labour only subcontractors unless they are themselves levy payers A supply and fit contract is when the materials total more than 10% of the value of the contract Do not include any payment made to supply and fit contractors Complete Part 5 or Part 7 of the form not both You cannot pay by direct debit if you have taken the Current Year Option (Part 5) You cannot pay by direct debit if you have not completed your Annual Return Form Please assist CITB-ConstructionSkills NI by completing your address as we plan to communicate more with employers via Levy Payers Certificates are only issued upon request and must be requested well in advance of requirement. Please allow a minimum of 5 working days for issue following your request. 3

6 Guidance on Completion of 2011 Annual Return Note 1 Your Details Please complete in the right hand column any changes to your previous details. These details are all deemed essential and we would encourage you to complete all contact details including contact telephone numbers. CITB- ConstructionSkills NI would also encourage you to provide at least one contact address to enable us to increase communication by means of . Important Change Note 2 Construction Establishment and Establishment Details As part of our ongoing review of the levy collection, we are changing our policy from 1 September 2011 to ensure that a fair and reasonable system is applied to all employers working in a construction activity. The principle change is that levy will be collected from those establishments within an organisation that are construction establishments as defined within the Order. An employer who owns two or more construction establishments may elect to have all establishments assessed as if they were a single establishment. If an employer has more than one establishment from the tax year ended April 2011 levy will only be collected on the construction activities of the establishment. We require you to identify on your Annual Return Form all establishments construction related and non construction related. If construction activities which are not specified within our legislation are part of your establishment, CITB- ConstructionSkills NI will work on a wholly or mainly assessment to ascertain through audit the main activity of your business. - If the majority of the activities fall within our legislation levy will be collected on the total emoluments. You must advise us in writing if you wish to receive a joint assessment notice. Note 3 Main Activity of a Business CITB-ConstructionSkills NI is required by law to collect levy from employers who are engaged in an activity within the construction industry in Northern Ireland. Note 4 Member of an Employer Organisation We consult regularly with employers organisations on key issues affecting the needs of the industry. It is important that you tell us of all the employers organisations that you belong to. This enables us to ensure that those we consult with represent the majority of our registered employers to measure 4

7 support for future proposals. Be assured we do not pass financial information you give us to any employer organisations (except where legally required). Note 5 Current Year Option Please complete Part 5 if you wish us to calculate your levy using emoluments for the current tax year i.e. the tax year commencing 6 April Once an election has been made it cannot be withdrawn or amended. Employers who elect to have their levy calculated on this basis will be issued Option Forms in October 2011 and April 2012 which must be returned detailing emoluments for the periods 6 April 2011 to 5 October 2011 and 6 October 2011 to 5 April The Board will issue notices of assessment for each of these periods. It is not possible to pay your levy by Direct Debit if you elect to take the Option. NB: If you wish to elect for the Option, your completed Annual Return form must be received by CITB- ConstructionSkills NI no later than 5.00pm on 31 August CITB-ConstructionSkills NI will accept online, faxed or ed copy on or before 5.00pm on 31 August We will not be held responsible for Option applications which have not been received prior to the deadline stated. Applications received after 5.00pm on 31 August 2011 will be refused. No excuses will be accepted for late options or options not received prior to the deadline. Please ensure if you post your form that you have allowed sufficient time for it to be received. CITB- ConstructionSkills NI would advise anyone wishing to avail of the option to ring on to ensure the applications have been received before 5.00pm on 31 August Note 6 Number of Employees on PAYE Please write in Part 6 the number of employees directly employed during the tax year ended 5 April Note 7 Payments (i) Emoluments to be included - PAYE You must include the total GROSS emoluments (before deductions) made to all employees (including working directors, administrative, technical and clerical staff as well as operatives) which are taxed under Schedule E for construction activities. Please refer to your PAYE Deduction Working sheets (Form P11) or HMRC Year End Returns for this figure. Do not include 5

8 emoluments relating to pensions, catering staff, or payments to employees which relate to work outside Northern Ireland. Also see Note 2 for information on establishments. You are advised to keep records of all payments included in this calculation as we are required by law to examine them. (ii) Emoluments to be included labour only subcontractors You must include the total GROSS emoluments (before deductions) made to labour only subcontractors, under labour only agreements plus any emoluments made to employment agencies for labour. Do not include VAT. If you employ labour only subcontractors who are not levy payers, you are liable to pay levy on all emoluments made to them. Also see Note 2 for information on establishments. You are advised to keep records of all payments included in this calculation as we are required by law to examine them. (iii) To be excluded: Emoluments to labour only subcontractors who are themselves levy payers. The CITB-ConstructionSkills NI Alphabetical Listing contains all levy payers registered in Northern Ireland. Please refer to this list when making your calculations. Employers registered after the date of the publication may apply for a Levy Payers Certificate. If you have excluded employers who have produced a certificate we advise that you keep a copy for your records. Emoluments paid to subcontractors for work conducted outside Northern Ireland. Emoluments paid to administration or support staff working in Northern Ireland who only support activities outside Northern Ireland. You are advised to keep records of all payments included in this calculation as we are required by law to examine them. Pensions or emoluments paid to any catering staff. 6

9 See Note 2 for information on establishments. Note 8 Accountant Details Please complete this section with details of your accountant. Note 9 Direct Debit Payments CITB-ConstructionSkills NI is aware of the current hardships of the construction industry and would encourage levy payers to pay their levy assessment by Direct Debit for which there is no additional charge. This process allows levy payers to pay the levy in 10 equal monthly instalments please tick this section and refer to Page 10 for further details. Although we encourage levy payers to commence paying by Direct Debit in October, we will accept this request any time between October and July provided you have supplied actual figures. Payment by Direct Debit can only be made if you have provided CITB-ConstructionSkills NI with actual figures for the current year. Please note that if you are audited during the year and the amount of levy due changes, you will receive a revised schedule of payments prior to CITB- ConstructionSkills NI collecting the next instalment of levy. Additional levy for prior years cannot be collected by Direct Debit. Maximise your Grant Return Through our website you have the facility to claim your grant online. This process makes it more efficient for both your organisation and ours. In this training year we wish to reward all employers by increasing grant payment for those who: 1. Claim online and paying levy by cheque - 2.5% 2. Pay levy by Direct Debit, BACs or Standing Order* and claim by submitting a claim form through the post - 2.5% 3. Claim online and paying levy by Direct Debit, BACs or Standing Order* - 5% Direct Debit payments must be applied for and a mandate completed annually. * BACs and Standing Order payments to be made within specified time limit (30 days) in order to be eligible for bonus grant. 7

10 For details of your username and password contact a member of the Training Operations Support Team on This additional grant support will be processed automatically on receipt of each on line grant claim when the above criteria have been met. All other conditions of grant apply. Note 10 Registration If you believe that someone should be on the list of Levy Payers and is not, please provide full names and addresses in this section. Please remember, CITB- ConstructionSkills NI can only register someone who is an employer, in the construction industry in Northern Ireland and levy only applies to those who pay out more than 80,000 per year in emoluments. You should not exclude a labour only subcontractor from your Annual Return Form to CITB- ConstructionSkills NI unless you are certain they are a levy payer. If you are in any doubt contact us. Note 11 Declaration Please ensure that all information supplied on this form is correct to the best of your knowledge and signed by someone in authority within your establishment. Queries If you have any difficulty completing this form, please contact us on (028) or lesley.longstaff@citbcsni.org.uk. CITB-ConstructionSkills NI Website CITB-ConstructionSkills NI s website has recently been upgraded to allow employers to file their Annual Return Form online and we would encourage all employers to use this facility. Your username and password are on the front cover of the 2011 Annual Return Form for your convenience. Grants can also be submitted online. Please visit our website at 8

11 Levy on Emoluments to Labour Only Subcontractors? Employers must pay a levy on payments to labour only subcontractors as well as on direct employees. The employer must include in the Annual Return the total of all emoluments made for labour only services in the last tax year. This includes emoluments to all firms and individuals, who are not registered with CITB-ConstructionSkills NI. CITB- ConstructionSkills NI s annual registered list of levy payers gives the names of all active levy payers. Employers should declare gross emoluments before any deductions (other than pensions) for example, insurance and tax. Employers should not include VAT on the payments. Under the Industrial Training (Northern Ireland) Order 1984 CITB- ConstructionSkills NI levies employers in the construction industry. The Order does not give authorisation to employers to levy or make deductions from any amounts paid to a labour only subcontractor or other worker. However, Part VI of the Employment Rights (NI) Order 1966 enables an employer to make a deduction from emoluments of a worker employed by him when: The deduction is authorised under the worker s contract, Or The worker has previously signed in writing his agreement or consent to the making of the deduction. There have been a number of cases before industrial tribunals about employer deductions of CITB levy. The tribunals have made it clear that the deductions are legal only if the worker has agreed beforehand. The condition shown above of the Employment Rights (NI) Order applies to deductions made from labour only subcontractors as well as employees on PAYE. You may want to get legal advice about your own circumstances. 9

12 Pay your Levy the easy way and sign up for CITB-ConstructionSkills NI s Direct Debit Scheme CITB-ConstructionSkills NI is offering all employers the opportunity to pay their levy in 10 monthly Direct Debit instalments at no extra cost. We would encourage employers to sign up to direct debit in order to ease the burden of paying levy in the alternative two instalment method. A grant enhancement is available to employers who claim grant online and sign up to pay levy by direct debit. Please refer to the terms and condition of grant for full details. All you need to qualify for Direct Debit is to: Complete your 2011 CITB- ConstructionSkills NI Annual Return Form before 5.00pm on 31 August 2011 and return it to the Levy Department, CITB-ConstructionSkills Northern Ireland, Nutts Corner Training Centre, 17 Dundrod Road, Crumlin, Co Antrim, BT29 4SR. Complete the Direct Debit Mandate which is enclosed with the Annual Return Form and return it to the Levy Department, CITB- ConstructionSkills Northern Ireland, Nutts Corner Training Centre, 17 Dundrod Road, Crumlin, Co Antrim, BT29 4SR. Even if you have previously signed up to pay by Direct Debit please complete and return a new mandate. CITB-ConstructionSkills NI makes no charge for the direct debit service and you will receive notice of how much is payable before any monies are collected from your bank. After you have agreed to pay by Direct Debit instalment, we will do the rest for you. Your levy will be calculated in October 2011 and will be debited from your account in 10 equal instalments commencing in October CITB-ConstructionSkills NI can only calculate levy based on the information provided on the Annual Return Form. Direct Debit Mandates must be completed annually as CITB- ConstructionSkills NI can only apply the direct debit scheme to employers who have provided actual figures on their 2011 Annual Return Form. CITB-ConstructionSkills NI can only collect levy by Direct Debit for the current training year. If you have previously paid by Direct Debit and have had a recent adjustment to your account for prior years incurring additional levy, this amount cannot be collected by the current direct debit scheme and payment by an alternative method should be arranged. 10

13 Maximise your Grant Return Increase your grant payment by 1. Claiming online and paying levy by cheque - 2.5% 2. Paying levy by Direct Debit, BACs or Standing Order* and claim by submitting a claim form through the post - 2.5% 3. Claiming online and paying levy by Direct Debit, BACs or Standing Order* - 5% For details of your username and password contact a member of the Training Operations Support Team on This additional grant support will be processed automatically on receipt of each on line grant claim when the above criteria have been met. All other conditions of grant apply. You cannot pay by direct debit if you have elected to base your levy on the 2011/2012 tax year i.e. the Option. However, you can still pay by BACS to avail of the grant incentive. * BACs and Standing Order payments to be made within specified time limit (30 days) in order to be eligible for bonus grant. 11

14 Answers to Our Frequently Asked Questions Q1 A Q2 A Q3 A Q4 A Why am I registered with CITB-ConstructionSkills NI? You are required to register if you are an employer who is involved in a construction activity in Northern Ireland and working for 27 or more weeks in the tax year. How do I de-register with CITB-ConstructionSkills NI? You cannot de-register with CITB- ConstructionSkills NI unless you cease trading or your activity changes and falls outside the scope of the legislation. I have received an Annual Return Form, how do I complete it? Please use these guidance notes provided with the form which will explain what is required. You can, if you wish, fill your 2011 Annual Return Form in online at before 5.00pm on 31 August Alternatively, please contact us and we can talk you through it. What figures do you require on my Annual Return form? You must give the gross amount paid to all PAYE involved in construction related activities including working directors and any bonuses paid. You must also Q5 A Q6 A give us the gross figures for labour only subcontractors involved in construction related activities who are not themselves levy payers. Emoluments for work outside Northern Ireland should not be included. Also emoluments for administration and support staff supporting activities outside Northern Ireland should not be included. If construction work is undertaken both in and outside NI, emoluments should be apportioned between these areas. How and when is levy calculated & invoiced? Your emoluments for the tax year are multiplied by the appropriate levy rate. Invoices are raised in two instalments October & February, unless you have elected to pay by Direct Debit, or if the Option is taken you will be invoiced in October & April. What is a construction establishment? It is a business or a distinct part of a business carrying out construction activity which is operating in Northern Ireland for a period of 27 or more weeks in the relevant tax year. 12

15 Q7 A Q8 A What does this mean to my business? The levy will be a fairer system to all involved in the construction industry and will only collect a levy on those parts of the business that are clearly involved in construction, if they are above the levy threshold. What is the Option? The Option is when levy is calculated on the current tax year figures i.e. April 2011/12. You would only take the Option if your emoluments were going to be less in the current tax year than in the previous year or if it is your first year of trade and you wish to avail of grants. The deadline for receiving Option requests is 5.00pm on 31 August 2011, unless it is your first year of trade. This deadline is strictly adhered to. Late Option requests will be refused without exception. Q9 A What are the benefits of being registered with CITB- ConstructionSkills NI? As a registered in scope employer you can claim grant for training and qualification achievement in many disciplines that will improve the performance of your business. In addition to the financial benefit that CITB-ConstructionSkills NI grant scheme provides, you also receive benefits from services including training and careers advice. The Mobile Training Unit (MTU), which can deliver a range of health and safety training on site, is free of charge to registered in scope employers. Identification of training providers and their courses is also available through the training directory. Q10 Can I pay by instalments? A Yes. You can elect to pay by direct debit in 10 equal monthly instalments commencing in October and ending in July if you have provided actual figures. You must notify CITB- ConstructionSkills NI if you wish to pay by direct debit by completing Part 9 of the Annual Return Form and completing a Direct Debit Mandate each year. 13

16 Q11 Why is the person I am working for deducting levy from my pay? A CITB-ConstructionSkills NI is the only body authorised to collect levy but it is a matter between you and your employer what arrangement you have agreed on. It is unlawful for anyone to make a deduction from your emoluments without your consent. Q12 Can I get a Levy Payer Certificate to show the main contractor that I am paying levy directly to CITB- ConstructionSkills NI? A A Levy Payer Certificate can be issued to any levy payer upon request. Please allow a minimum of 5 working days for receipt. Q13 Do I include VAT? A No. VAT should not be included. Q14 What methods of payment do you offer? Electronic (i.e. BACs) Sort Code: A/C No: A/C Name: Construction Industry Training Board (Please quote your CITB- ConstructionSkills NI registration number if paying electronically) Paid within 30 days from date of invoice. Direct Debit Figures must be actual and payments are taken over 10 months Cheque Made payable to CITB and paid within 30 days from date of invoice. Debit/Credit Card Call with card details within 30 days from date of invoice. Q15 What facilities are available online? A We are continually updating our website depending on the requirements of the industry and will introduce additional items as and when available. We have recently commenced paying grant directly into the employer s bank via BACs for those employers who have requested this method of payment. You can currently do the following online: Complete your Annual Return and submit it before 5.00pm on 31 August Complete grant applications online 14

17 Maximise your Grant Return 1. Claiming online and paying levy by claim - 2.5% 2. Pay levy by Direct Debit, BACs or Standing Order* and claim by submitting a claim form through the post - 2.5% 3. Claim online and paying levy by Direct Debit, BACs or Standing Order* - 5% For details of your username and password contact a member of the Training Operations Support Team on Q16 Can I fill the Option Forms in Online? A Yes. You can complete the 2011 Annual Return Form and elect to have your levy based on the 2011/12 tax year online however, there is no current facility to complete the first or second option forms online. These forms will be posted to you in October and April and should be completed within 30 days and returned to CITB- ConstructionSkills NI. * BACs and Standing Order payments to be made within specified time limit (30 days) in order to be eligible for bonus grant. 15

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20 For further information contact: CITB-ConstructionSkills Northern Ireland Nutts Corner Training Centre 17 Dundrod Road Crumlin BT29 4SR Tel: Fax: / levy@citbcsni.org.uk CITB-ConstructionSkills, CIC and CITB- ConstructionSkills Northern Ireland are working as ConstructionSkills, the Sector Skills Council for Construction CITB trading as CITB-Construction Skills Northern Ireland