You should register as a subcontractor with the Construction Industry Scheme (CIS) if you’re self-employed or have your own company and are working for a contractor in the construction industry.
CIS is administered by HM Revenue & Customs (HMRC). It regulates payments from contractors to subcontractors in the building industry.
How to register
To register as a subcontractor, call the CIS helpline. You’ll need:
- the name you want to register with (eg your name, business name)
- the unique taxpayer reference number (UTR) for your business
- a National Insurance Number
If you don’t have a UTR, register for Self Assessment before you register with the CIS.
Telephone: 0300 200 3210
Monday to Friday, 8am to 8pm
Saturday, 8am to 4pm
Find out about call charges
Your contractor will make CIS deductions from the payments they make to you. These count towards your tax and National Insurance payments when you fill in your Self Assessment tax return.
Once you’ve registered with the CIS, you can apply for gross payment status if your business passes some tests. This is where you get your full payment without any deductions.
You must still register with CIS if you’re based abroad but do construction work in the UK - the registration process is different though.
You must keep records of your business income and outgoings. You’ll need these to fill in reports and returns you send to HMRC, eg your Self Assessment tax return.
Sole traders and partners in a partnership
Your contractor will make CIS deductions from their payments to you after taking off the cost of any materials you supplied.
The CIS deductions will count towards your tax and National Insurance bill when you fill in your Self Assessment tax return.
As a company subcontractor you can offset your CIS deductions immediately against the tax and National Insurance contributions you pay to HMRC each month as an employer and contractor.
To reclaim deductions for the tax years up to and including 2012 to 2013, you’ll need to complete a P35 Employer Annual Return - usually online.
From the 2013 to 2014 tax year onwards you’ll need to send HMRC an Employer Payment Summary (EPS) monthly. You should show the CIS deductions taken from your own income that you want to set against the tax and National Insurance contributions you owe HMRC as an employer and contractor.