Bryan Slater Director of Education	Distribution
	Headteachers All Schools

This document needs your action as detailed below:

ACTION	Title	Construction Industry Scheme (CIS)
	Summary of contents	Letter explaining the Scheme
	Associated documents
	Date	27 August 2004
	Summary of action required	All schools need to sign and return the undertaking form and return to Education Financial and ICT Services
	To be completed by	21/10/2004
	LEA Contact	Douglas Slade	(	01603 222551
	E-mail address	douglas.slade@norfolk.gov.uk
	Norfolk Self Review reference	7. How well is the school led and managed?
	Document reference	MI 157-04

CONSTRUCTION INDUSTRY SCHEME (CIS)

The Inland Revenue requires the County Council to account for Construction Industry Tax (CIT) due. This requirement extends to all payments made using County Council funds and therefore includes all schools funded by the Council. Because of this requirement schools are not able to pay invoices locally but have to send them to the Cashier's Office for payment. This arrangement has operated for a number of years.

Concession

Schools may pay locally any invoice whose total does not exceed £500 (excluding VAT). Schools are asked annually to renew an undertaking not to abuse the concession.

Changes to The CIT Scheme

Changes have been made to tighten the regime. All contractors and sub-contractors in the construction industry have to register with the Revenue. A contractor who is not registered with the Revenue cannot be paid even though he may have done work.

I enclose a procedure paper for CIS including a standard condition to all orders for building work warning the contractor that he will not be paid unless he is registered with the Revenue. This condition must be included on all orders for construction works.

The procedure note tells you which invoices are affected by the CIT Scheme. All these invoices, unless covered by the concession, must be sent to the Cashier's Office for payment.

Undertaking

Please sign and return the undertaking form relating to the concession.

Further Advice

Further advice can be obtained from your Finance Support Officer.

Yours sincerely

Douglas Slade

Chief Education Accountant

Form: F0021/v6

Construction Industry Scheme

Financial Year 2004/05

Concession Form

School Name: «School»

Location Code: «Locn»

I agree to abide by the £500 concession limit for processing invoices for payment locally; invoices greater than £500 will be passed to the Director of Finance for examination and processing; a single job of work will not be divided to try and evade the £500 concession limit.

Signed: ______________________________ _____________________

Responsible / Authorised Officer Date

Please return to:

Education Financial and ICT Services, Room 064, County Hall, Norwich.

Received Date

Dbase updated Date

Procedure Note No. 2/1999

Accounting - Construction Industry Scheme

This applies to all invoices for building and construction that are charged against Budget Heading E12 (Building Maintenance and Improvement) or Budget Heading E13 (Grounds Maintenance and Improvement).

Similarly, this procedure applies to all invoices relating to building work covered under Capital Formula (ECAPFM), Seed Challenge (ECAPSC) and Specialist Schools (ECAPSP) grants.

The procedure for processing invoices for payment is as follows:

a) Determine the relevant Budget Heading and the appropriate subjective code which the invoice will be charged against.

b) If the value of the invoice, excluding VAT, is less than £500, the invoice can be paid locally.

A cheque will be made payable to the supplier/company concerned in the normal way.

c) If the invoice value, excluding VAT, is greater than £500, the original invoice and a cheque for the full amount including VAT, made payable to “Norfolk County Council” must be sent to County Hall for examination and processing.

The invoice and cheque should be sent in an envelope addressed as follows:

CIS

Cashiers Office, Ground Floor

County Hall, Martineau Lane, Norwich.

NR1 2UG

On receipt, the cashiers department update their register of invoices/cheques received and the cheque is banked. Invoices are passed to CAPITA for examination and payment on a daily basis.

CAPITA operate a twice weekly payment cycle and therefore payments are made on a Tuesday or a Friday.

NB Schools will be aware that most invoices need to be paid within a 30 day cycle and therefore schools will need to take into account the time it takes for the “paperwork” to reach County Hall.

If an invoice has special terms (payment within seven days), this will need to be processed quickly.

Endorsing Purchase Orders estimated more than £500 relating to the building:

The standard condition is as follows:

“Payment of this order can be made only if you have a valid CIS registration card or a tax certificate.”