Construction Industry Scheme (CIS)

If you are working in the construction industry whether as self employed or through a limited company, you will have certain responsibilities towards HM Revenue and Customs (HMRC) and that is where Eureka Accountants can help you to fulfil all your obligations. We provide our CIS tax returns and accounting services to individuals and companies.

What is Construction Industry Scheme (CIS) and how it works?

Under the Construction Industry Scheme (CIS), contractors deduct money from a subcontractor’s payments and pass it to HM Revenue and Customs (HMRC).

The deductions count as advance payments towards the subcontractor’s tax and National Insurance.

Under the Construction Industry Scheme, if you are a subcontractor you will need to register with HMRC as a CIS sole trader. Your CIS contractor will check your registration with HMRC and if verified will deduct 20% of tax from your invoices and will pay this to HMRC on behalf of you. If you are not a registered CIS subcontractor, your contractor will deduct 30% of your invoices.

Who counts as a contractor or subcontractor?

Contractors must register for the scheme. Subcontractors do not have to register, but deductions are taken from their payments at a higher rate if they’re not registered. Register as a contractor if either.

Register as a subcontractor if you do construction work for a contractor.
You must register as both if you fall under both categories.

Work covered by CIS

CIS covers most construction work to:

For the purpose of CIS, construction work includes:

Preparing the site - for example, 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

Exceptions

You do not have to register if you only do certain jobs, including:

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 - for example, running a canteen or site facilities

How we can help?

At Eureka, we have a team of expert CIS employed accountants who can help you with the following:

For more information and to arrange a free consultation, please contact us.

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