CIS

What is CIS?

The Construction Industry Scheme (CIS) is an HMRC scheme to prevent tax evasion in the construction industry. It features a series of rules on how subcontractors in construction should be paid. Within CIS, HMRC deducts a certain amount in tax and National Insurance contributions from the payment given by contractor to the subcontractor.

How Much Will Be Deducted?

If a subcontractor is CIS registered, 20% will be deducted. If they are unregistered, it will be 30%.

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What work does it cover?

CIS regulation covers:

  • A permanent or temporary building or structure.
  • Civil engineering work like roads and bridges.
  • Preparing the site
  • Demolition and dismantling
  • Alterations, repairs, decorating
  • Building work
  • Installing central systems like heating, lighting, water, ventilation, or power. 
  • Cleaning the inside of the buildings after construction.

Source Gov.co.uk.

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What are the exceptions?

If a subcontractor is CIS registered, 20% will be deducted. If they are unregistered, it will be 30%.

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