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How Do You Calculate Your CIS Tax Return?

Contractors withhold money from subcontractor payments and remit it to HMRC under the construction industry system (CIS). The deductions are seen as payments in advance for the subcontractor's tax and social security contributions.

By cheap accountantPublished 8 months ago 5 min read
Cheap accountants in London

Contractors are required to register with the system, but subcontractors are not required to do so. Their contributions are debited at a higher rate even if they do not register. If you want to know "How to Calculate CIS Tax Return," contact Best accountants in London. If you have paid too much tax or national insurance, we can help you have your construction industry scheme (CIS) deductions refunded.

What exactly is the construction industry scheme in the CIS?

The CIS is a tax deduction mechanism in which tax is deducted at the point of payment from building project payments. Employee payments are not subject to CIS since they are subject to the Pay As You Earn (PAYE) tax deduction scheme at the point of sale. If you work in the construction business, you must file a Self-Assessment tax return that includes a refund reconciliation.

How do I compute my CIS tax return? When should you sign up for the CIS scheme?

Do you work in the construction industry in the UK? Did you know that you must register for the Construction Industry Scheme (CIS) if you work for a contractor and are self-employed, the owner of a limited liability company (LTD), or a partner in a partnership?

Calculating Tax Deductions

If you want to know how much tax you can deduct for the previous fiscal year. Affordable accountants in London specialists can help you complete and submit your tax return. We are one of the country's oldest and most comprehensive tax refund companies, based on Gloucester Road in West London. This way, you can be certain that the tax return declaration is filled out correctly, that it is completed on time, and that you are not paying more tax than necessary.

When is the deadline for receiving a CIS refund?

If you deduct tax under CIS and have a smaller income, you will almost certainly receive a refund due to trade expenses and the availability of personal allowances. This is critical because HMRC may need proof that you spent money on something that was wholly and solely for your business. You should not invent them or add private expenses to reduce your taxable profits and obtain a larger refund; doing so is prohibited and punishable by hefty fines.

What kind of construction work are covered by the CIS?

The CIS applies to the majority of construction work involving permanent or temporary buildings, as well as structural or civil engineering work such as roads and bridges. All construction work, including site preparation, laying foundations and giving access, demolition, and dismantling, as well as constructing, alterations, repairs, and decorating are all included in the CIS definition of construction activity. Our straightforward tax solution will take the sting out of your CIS tax returns. Cheap accountants in London will process your CIS tax return online in a timely manner. We are a CIS tax return accounting team that specialises in CIS self-assessment tax returns.

How long does it take to collect your CIS tax refund?

After filing your tax return, you should expect to receive your refund within one to eight weeks. The period is primarily determined by HMRC security checks and processes. For example, if it's a busy time of year for them, this can slow things down.

What happens if you're a subcontractor?

The good news is that subcontractors can get CIS tax back from HMRC at the end of each fiscal year. The realities of collecting this reimbursement, on the other hand, can be tricky.

When should the CIS return be filed?

CIS returns reflecting the preceding tax month's activity must be submitted by the 19th of the month. A tax month begins on the 6th of each month and ends on the 5th of the following month. So, the deadline for filing a CIS return for the tax month of April 6th through May 5th is May 19th. You may be asking who is in charge of paying CIS to HMRC. Any deductions made as a contactor must be paid to HMRC. HMRC will set up a Construction Industry Arrangement (CIS) payment arrangement for you when you register as a contractor. If you already have employees, HMRC will convert your current PAYE plan to a PAYE/CIS system.

Keeping records under the CIS scheme

Did you aware that failing to deliver your CIS records when HMRC requests them might result in a £3,000 fine? To be safe, keep these facts for at least three years after the end of the tax year to which they apply. At any moment, HMRC may seek access to your CIS records. This is why you must safeguard your records. Under the Construction Industry Scheme (CIS), you must keep the following records:

  • The sum of all subcontractor payments invoiced, excluding VAT.
  • You may have made subcontractor payment deductions.

Except for VAT, if you make deductions, you must also keep records of the cost of materials invoiced to you by the subcontractor.


If your company works in the construction industry or does construction-related work, you may be required to register as a CIS contractor or subcontractor with HMRC. The CIS scheme outlines how contractors must handle subcontractor payments for building operations. Generally, it is the contractor's responsibility to decide if a subcontractor operates within the CIS, but you should double-check with HMRC to be sure. Before making any payments, the contractor must check with HMRC to ensure that the subcontractor is registered under the CIS. Contact us if you need help with your CIS tax refund in the UK. Cheap Accountants in London is a top CIS tax return accountant.


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