The Construction Industry Scheme (CIS) is a set of special rules for handling payments for construction work.
The scheme covers all construction operations carried out in the UK as well as other related work.
There are strict filing deadlines when filing the monthly CIS returns to HMRC and failure to comply with these will result in a penalty, even if the deadline goes over by just one day. We can relieve you from the stress of completing the returns and provide your sub-contractors with their monthly CIS deduction statements.
The Construction Industry Scheme (CIS) sets out rules for how payment to sub-contractors must be handled.
The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
Contractors must register for the scheme. Subcontractors don’t have to register, but deductions are taken from their payments at a higher rate if they’re not registered.
Who counts as a contractor or subcontractor
Register as a contractor if either:
- you pay subcontractors for construction work
- your business doesn’t do construction work but you spend an average of more than £1 million a year on construction in any 3-year period
Register as a subcontractor if you do construction work for a contractor.
You must register as both if you fall under both categories.
Work covered by CIS
CIS covers most construction work to:
- a permanent or temporary building or structure
- civil engineering work like roads and bridges
For CIS, construction work includes:
- preparing the site, e.g. laying foundations and providing access works
- demolition and dismantling
- building work
- alterations, repairs and decorating
- installing systems for heating, lighting, power, water and ventilation
- cleaning the inside of buildings after construction work
You don’t have to register if you only do certain jobs, including:
- architecture and surveying
- scaffolding hire (with no labour)
- carpet fitting
- making materials used in construction including plant and machinery
- delivering materials
- work on construction sites that’s clearly not construction, e.g. running a canteen or site facilities