Enter your idea

Using the new Contracts form, when verifying a subcontractor, you are now asked to enter the CIS Tax Rate (Gross, 20% or 30%) before you verify the subcontractor.
You cannot save and verify with HMRC unless this field is completed. Without verification, you cannot be certain as to the tax rate.

The error could occur where you choose a rate for the purpose of being able to 'save and verify'. If the verification failed and you required to speak to the contact, or in most cases wait for HMRC to add a subcontractor to the CIS scheme which is currently up to 28 days. In the meantime, you have an incorrect tax rate saved on the subcontractors profile. From a bulk invoicing view, no warning system is available so invoices can be incorrectly processed leading to overpayments.

Either Xero need to remove CIS Rate as a required field for 'Save and Verify' process or an additional Not yet Verified value is required on the drop down.

The old contact form was working fine with regards to managing verification processes for subcontractors?