Under the scheme, contractors deduct money from a subcontractor’s wage payment and pass it onto HMRC.
The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
Contractors must register for the scheme. Subcontractors don’t have to register, but deductions are taken from their payments at a higher rate if they’re not registered.
Anybody who works in the UK construction industry is required to comply with HMRC’s tax rules and regulations, otherwise known as the Construction Industry Scheme (CIS).
If you’re a mainstream contractor and you pay subcontractors, or if you use a flexible workforce, then CIS applies to you. It covers everyone from builders and labour agencies to property developers and gangmasters.
What work is covered by CIS?
CIS covers most construction work to:
For CIS, construction work includes:
You don’t have to register if you only do specific jobs, including: