Construction

Subcontractor (CIS) Returns

We handle your monthly CIS returns and ensure full compliance with HMRC's Construction Industry Scheme — for both contractors and subcontractors.

The Construction Industry Scheme (CIS) requires contractors to deduct tax from subcontractor payments and pass it to HMRC via monthly returns. Missing a deadline or filing incorrectly results in automatic penalties. We manage the entire process — from verifying subcontractors through to monthly submissions and payment notifications.

How CIS works

Under CIS, contractors must register with HMRC, verify their subcontractors before making any payments, and deduct tax at the correct rate from the labour element of each payment. The deduction rates are 20% for registered subcontractors, 30% for unregistered subcontractors, and 0% for those with gross payment status. Deductions are passed to HMRC via the monthly CIS return and count as advance payments towards the subcontractor's tax liability.

CIS deadlines and penalties (April 2026 changes)

From April 2026, HMRC reinstated the full CIS late filing penalty regime. Monthly returns must be submitted by the 19th of the month following the tax month (which runs from the 6th to the 5th). Payment of deductions follows the same deadline (22nd for electronic payment).

Use our free quote tool for pricing tailored to your requirements.

22nd of month

Electronic payment of deductions

£100

Automatic penalty for late filing

£200

Additional penalty after 2 months

From April 2026, nil returns are also required in months where no subcontractor payments have been made (or an inactivity request must be submitted in advance). We manage this on your behalf.

Monthly payment notification

Once each monthly return is filed, we provide a clear letter outlining the total CIS deductions due to HMRC, the payment deadline, and step-by-step instructions on how to pay — ensuring nothing is missed and no penalties are incurred.

Reclaiming CIS deductions for subcontractors

If you are a subcontractor, CIS deductions made by contractors count as advance payments towards your tax liability. For sole traders and partnerships, deductions are reclaimed through the Self Assessment tax return. For limited companies, they are offset via the Employer Payment Summary (EPS) against PAYE payable. Many subcontractors overpay through CIS deductions and are entitled to a refund — we make sure you claim back everything you're owed.

MTD for CIS subcontractors

From April 2026, CIS subcontractors with qualifying income over £50,000 must comply with Making Tax Digital for Income Tax. The threshold drops to £30,000 from April 2027. We can help you prepare for this change and ensure your digital records and quarterly submissions are in order.

Ready to get started?

Get a free, no-obligation quote in minutes — or get in touch to discuss your requirements.