top of page

Nasa Consulting - CIS

Contractors and subcontractors operating in the construction industry are required to register for the Construction Industry Scheme (CIS) with HMRC. Failure to register can result in penalties for contractors, or a higher deduction from sub-contractor’s pay.

The construction industry scheme (CIS) is extensive and covers most work to either a permanent or temporary building/structure or civil engineering works such as roads and bridges.

Registered contractors must:

• Make deductions from payments to their subcontractors

• Submit monthly reports to HMRC detailing the amounts deducted and paid (CIS300)

• Pass these deductions on to HMRC on behalf of their subcontractors

These deductions count as advance payments towards the subcontractor’s tax and/or National Insurance contributions when completing their own personal tax returns. During the sub-contractor’s personal tax return submission, they may be able to claim back excess CIS deductions resulting in an income tax refund.

Deductions are made at:

• 20% if subcontractor is registered for CIS

• 30% if subcontractor is unregistered

Subcontractors are not required to register for CIS but it is beneficial to register in order to avoid deductions being taken from pay at a higher rate.


bottom of page