Under the Construction Industry Scheme, contractors deduct money from payments to subcontractors and pass it to HMRC as an advance payment towards the subcontractor’s tax and National Insurance. The scheme covers most construction work on buildings and structures, including site preparation, alterations, repairs, decorating and demolition, and it applies to many businesses that would not describe themselves as builders.
For contractors, Anewthing registers the business, verifies each subcontractor with HMRC so the right deduction rate is applied, prepares the monthly CIS return and the deduction statements subcontractors need, and makes sure the deductions are paid over with the PAYE bill on time.
For subcontractors, Anewthing registers you so you are not deducted at the higher rate, keeps track of the deductions taken from you during the year, and claims them back through your Self Assessment return or, for a limited company, through the company’s payroll reporting. Where a business qualifies, Anewthing can also apply for gross payment status so that you are paid in full.
What’s included
- CIS registration for contractors and subcontractors
- Verifying subcontractors and applying the right deduction rate
- Monthly CIS returns and payment and deduction statements
- Paying CIS deductions to HMRC alongside PAYE
- Claiming CIS deductions back for sole traders and limited companies
- Gross payment status applications
How we work with you
Talk it through
Tell us what you need and how your records are kept.
Agree the scope and fee
You know what is included and what it costs before work begins.
Ongoing support
Deadlines and rule changes are raised with you before they become urgent.
Current rules at a glance
| CIS deduction rates | 20% for registered subcontractors, 30% for unregistered subcontractors, 0% with gross payment status |
|---|---|
| What is deducted from | The payment less VAT, materials the subcontractor paid for directly, plant hire, consumable stores and fuel (other than for travel) |
| Monthly CIS return | By the 19th of each month for the tax month just ended; a nil return is needed if no subcontractors were paid |
| Late return penalties | £100 after 1 day, £200 after 2 months, then £300 or 5% of the deductions at 6 and 12 months, whichever is higher |
| Paying deductions to HMRC | By the 22nd of each month if paying electronically (the 19th by post), with PAYE |
| Claiming deductions back | Sole traders and partners through Self Assessment; limited companies through an Employer Payment Summary |
Common questions
Do I need to register as a CIS contractor?
You must register if you pay subcontractors for construction work, and some businesses outside construction must register once their spending on construction work passes a set level. Anewthing can confirm whether the scheme applies to you.
How do I get my CIS deductions back?
Sole traders and partners claim them through the Self Assessment tax return. A limited company sets them against its PAYE liabilities through an Employer Payment Summary and claims any balance at the end of the tax year.