Contractor registration
CIS obligations for businesses paying construction subcontractors.
CIS affects how contractors verify subcontractors, calculate deductions, issue payment statements and report monthly payments. Subcontractors then need those deductions reconciled against their own tax position.
CIS deductions are advance tax payments, not a substitute for proper accounts. Gross invoices, materials, deductions and bank receipts still need to reconcile.
Contractor and subcontractor enquiries are welcome.
Prefer to call? 0800 135 7323
The contractor and subcontractor sides of CIS have different responsibilities.
The contractor's verification and return records should match the subcontractor invoices, payment statements and actual amounts paid.
Contractors and subcontractors have different compliance obligations, so the scope follows the role being performed.
CIS obligations for businesses paying construction subcontractors.
Correct verification before deductions are applied.
Payments and deductions reported to HMRC.
Subcontractor records showing gross pay and deductions.
Eligibility and ongoing compliance considerations.
Reconciliation of deductions against the subcontractor tax position.
Subcontractor details are checked before payment.
The relevant CIS deduction is calculated.
Payments and deductions are reported to HMRC.
CIS liabilities and deductions are reconciled to the accounts.
Using the wrong verification result can create under-deductions or unnecessary cash-flow problems for the subcontractor.
CIS does not determine employment status. A worker can fall within employment-tax rules even where the parties have described the arrangement as subcontracting.
Current contractor deduction rules.
Official CIS deductions ↗Current filing deadline and correction rules.
Monthly return guidance ↗20% for a registered subcontractor who is successfully verified.
The higher rate generally applies where a subcontractor cannot be verified.
It allows qualifying subcontractors to receive relevant payments without CIS deductions, while remaining responsible for their own tax liabilities.
By the 19th following the end of the relevant CIS tax month.
No. CIS does not turn an employee into a subcontractor. Employment status still needs separate consideration.
Company subcontractors deal with CIS suffered through the appropriate PAYE or employer mechanisms rather than simply deducting it from Corporation Tax.