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HMRC internal manual

Compliance Operational Guidance

Supporting Guidance: employer compliance: guidance by subject: employer and contractor’s role: operation of the construction industry scheme (CIS)

Contractors within the construction industry are required to operate CIS, which administers the way in which contractors make payments to their subcontractors. This scheme provides for deductions, at prescribed rates, to be made from payments to certain subcontractors.

The scheme also provided for subcontractors who held a valid tax certificate prior to 6-4-2007 to receive payments without the CIS deduction. See COG909500 onwards.

The scheme introduced with effect from 6-4-2007 provides for subcontractors who are registered for gross payment to receive payments without CIS deductions subject to a verification process by the contractor. See COG910000 onwards.

Advice to contractors on how to operate the scheme is contained in booklet IR14/15 (CIS) for the scheme up to 5-4-2007, and in booklet CIS340 and factsheets CIS341-349 for the scheme from 6-4-2007.