28/08/2026
🏗️ FRIDAY TAX TIP | CONSTRUCTION BUSINESSES: GET CIS RIGHT
Paying subcontractors? CIS is more than simply deducting 20%.
Before making payments, contractors should verify subcontractors with HMRC and use the deduction rate HMRC provides normally 20% for registered subcontractors, 30% where they cannot be verified, or 0% for those with Gross Payment Status.
When calculating the deduction, certain amounts are excluded first, including VAT, qualifying materials paid for directly by the subcontractor, certain plant hire, consumable stores and manufacturing/prefabrication costs.
📅 Key deadlines: File the CIS monthly return by the 19th following the tax month and pay deductions to HMRC by the 22nd electronically (19th by post).
Also keep verification records and provide subcontractors with their payment and deduction statements on time.
Getting CIS wrong can mean incorrect deductions, penalties, interest and unnecessary HMRC problems.
Need help keeping your CIS, payroll and construction accounts compliant? Speak to Matplus Chartered Accountants.
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