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Welcome to our Help Centre

RCT and CIS

Getting Started

Before you implement RCT or CIS in Surf Accounts for your business, we recommend you go through the Getting Started guide. Please note, RCT is not applicable to the professional such as architectures, surveyors etc.

Setting Up RCT for Ireland Business

To enable Relevant Contract Tax (RCT) for an Irish Business, select Settings˃ Accountants Set Up the following screen will appear. The option on the Account Setup pop up, the option Enable RCT Transaction tick box must be ticked. Please note RCT is only applicable for IE based business only.

For new IE business and existing business “Enable RCT Transactions” tick box will be unticked by default. for new IE business and existing business “Enable RCT Transactions” tick box will be unticked by default.

Setting up Construction Industry Scheme (CIS) for UK Business

To enable Construction Industry Scheme (CIS)for UK Business, select Settings˃ Accountants Set Up the following screen will appear. The option on the Account Setup pop up, Enable CIS Transaction tick box must be ticked.

Please note, CIS is only applicable for UK based business only

Enable RCT for Customer from Contact Browse for IE Business

If a business is a Subcontractor, the customer may be an RCT Principal. A tick box has been added to Customer Contact browse just below the VAT No. column to show as an RCT- enabled customer.

After selecting RCT Principal tick box a VAT Code will be automatically populated. You need to change the default VAT Code apart from the RCT VAT code. While saving an information message will appear as “Select VAT Code does not match with RCT VAT Code”.

You need to change the customer Default VAT Code to the RCT codes, whichever is applicable for your business.

Enable RCT for Supplier from Contact Browse for IE Business

If the business is a Principal, the suppliers of that business may be a Subcontractor. A tick box has been added to Supplier Contact browse just below the VAT No. column to show as an RCT- enabled supplier.

Enable CIS for Customer from the Contact Browse for UK Business

If a business is a Subcontractor, the customer may be a CIS Principal. A tick box has been added to Customer Contact browse just below the VAT No. column to show as a CIS- enabled customer.

Enable CIS for Supplier from the Contact Browse for UK Business

If the business is a Principal, the suppliers of that business may be a Subcontractor. A tick box has been added to Supplier Contact browse just below the VAT No. column to show as a CIS- enabled supplier.

New Nominal Code in Nominal ledger

In Surf Accounts we have added a new account code 748 for Retained Tax Control (for both IE Business and UK Business). From the Accounts tab, select Chart of Accounts under General Ledger the following screen will appear.

For UK business the nominal code and the description remain the same Retained Tax Control Chart of Accounts. The RCT values will be posted for control code 748 i.e. Retained Tax Control from Receipt and Payment.

Invoicing with RCT

Using RCT VAT see the following illustrations:

Detailed Sales Invoice:

If you have multiple product lines in detail sales or purchase invoice, the RCT VAT code must be same.

FIELD STEP
Customer Select the customer by using the magnifying glass.
Product Select the product by using the magnifying glass.
VAT % The RCT VAT code will auto-populate in the VAT % column as you have already set the VAT rate in the ‘Contact’ browse.

 

Please note, on the Quick Invoice the RCT VAT code should be same in splits.

New RCT/ CIS Invoice Layout

We have added a new line as “VAT on this supply to be accounted for by the Principal Contractor.” When you print the invoice this line will appear under the gross total.

Please Note, this line will not appear on the RCT enabled purchase invoice.

Posting of Receipt

We have added a new column in the customer receipt browse for RCT Customers (CIS for UK customer) followed by the ‘Paid’ column in detailed customer receipt.

If the customer is RCT / CIS enabled, we have added a new column to the allocation as RCT (CIS for UK Business) followed by the ‘Pay’ column.

Posting of Payment

If the supplier has RCT ticked, a new column to the allocations, "RCT" ("CIS" for UK).

If the supplier has RCT ticked, a new column to the allocations, "RCT" ("CIS" for the UK). The RCT rate entered on the invoice is same for all lines and split invoices.

Invoice "Unpaid" value reduces by the summation of Pay value, Discount, RCT.

VAT Return for Purchase

When your business is an RCT Principal, the RCT transactions take a similar approach to EU Notional VAT transactions. It is applied on both sides of the VAT return which cancel out. It will not appear in the E1 /ES1/ E2/ ES2 boxes.

Please note, RCT is only applied when principals and subcontractors are in the same country. 

  • The ‘Net’ is the invoice or payment if the business is on a cash basis.
  • VAT is the notional VAT rate.
  • Gross is the summation of the Net and the notional VAT amount.
  • In summary, on the Principal VAT return the ‘Notional' VAT rate is applied to the RCT invoice, and that value is included in boxes T1 and T2.

VAT Return for Sales

On Sales, if the business is RCT subcontractor, the sale is treated as same as any other Zero-Rated. The amount of VAT on Sales will appear under the T1 box.

Reports

We have added a new column as ‘RCT Value’ under the Customer – Non Customer Receipt and Supplier / Non -Supplier payment report. To include the RCT Value column, select the ‘Advance’ in the report and from the Column Order includes RCT Value column.

The generated report is shown below.

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