If you are working in the construction industry as a subcontractor, you will most likely have heard mention of ‘CIS’.
This is a scheme that means your contractor (the person paying you) will usually deduct money (20% tax) from your payments and pass it to HM Revenue & Customs. This money is then offset against your tax bill each year and can often generate a repayment.
You need to register to be in the scheme, if you don’t your deductions from your payments will be 30%.
Does what I do come under the scheme?
If you are working in construction related activities, you will likely be affected. There are some special cases, but in general if you are being paid by a contractor and you work ‘in the trade’ it is likely you will be under the scheme.
Some examples of what is IN the scheme:
- Construction work to a permanent or temporary building or structure
- Civil engineering work like roads and bridges
- Preparing the site, eg 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
Some examples of what is OUTSIDE the scheme:
- 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, eg running a canteen or site facilities
If you fancy a bedtime read, the full guidance on whether what you do is in the scheme is here.
What do I have to do to register?
To being, before you can register for CIS you will need to have applied to be self-employed. You can do this here.
Once you’ve done this, you can either apply for CIS online or call the helpline on 0300 2003210 – This takes around 10 minutes.