CIS – Construction Industry Scheme

We have been helping businesses/contractors and subcontractors deal with the administrative task of CIS for many years.

It can feel very daunting and take time to complete the task accurately, but we have the knowledge to take that stress away and ensure you
need not worry and all the deadlines will be met.


The Construction Industry Scheme (CIS) sets out the rules for how payments to subcontractors for work in the construction industry must be handled.


As a contractor, when you start working with a subcontractor for the first time, you will need to verify them with HM Revenue and customs.


If you are a contractor within the construction industry, then you will have to submit a CIS Return to HMRC before the 19th of each month. The return gives details of every payment you made to subcontractors under CIS during the last tax month.

As a contractor you must:
  • Register for CIS with HMRC
  • Check your subcontractors are registered with HMRC by verifying them online
  • pay subcontractors accordingly
  • submit monthly CIS returns
  • Pay CIS to HMRC

As a Subcontractor you must register with HMRC, if you are not registered, contractors have to deduct the higher 30% rate, instead of the registered 20% rate off your invoice

Running a Limited Company under CIS

You can offset your CIS deductions taken from payments received against the following:

  • Any PAYE payments due to HMRC
  • Your Class 1 National insurance contributions
  • CIS deductions the company has made from its own subcontractors

HMRC will repay any deductions that the company is not able to offset against its PAYE liabilities

Under RTI this is now done monthly using the EPS through payroll.

Offsetting your Monthly or Quarterly CIS liabilities

Each month or quarter you should offset your CIS liabilities against your PAYE/NICs payments.  This will either reduce your CIS payments or eliminate it fully.

If your liability is reduced to nil and there are still some unused CIS deductions that have not been offset, you should carry these forward to the next month or quarter within the same tax year and don’t forget to tell HMRC that you have no liability to pay over for that period.

If the company’s CIS deductions available for offset in any month or quarter do not cover the whole of the company’s liability for that period you must pay over the balance to HMRC by the usual payment date.

CIS Record Keeping

As part of our CIS service for Contractors we will:

Register contractors for the CIS scheme with HMRC.

Verify your new subcontractors with HMRC.

Produce payment & deductions statements for your subcontractors on a monthly basis.

Complete your monthly CIS return and submit to HMRC.

Help with general advice or queries about the CIS scheme

Advice you on tax due in a prompt manner.

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