Advice for CIS subcontractors
How CIS deductions work, what gross payment status means, and how to claim back what you're owed.
How CIS deductions work
A contractor deducts 20% from your labour if you're registered under CIS, or 30% if you're not; materials aren't deducted from. They pay HMRC the deduction on your behalf and give you a monthly statement showing what was taken.
Gross payment status
Meet HMRC's turnover and compliance tests and you can be paid gross, with no deduction at all; you handle the tax yourself through Self Assessment instead. It takes a track record of paying your own tax on time to qualify.
Claiming back what you're owed
Every CIS deduction counts as tax you've already paid, so it comes off your Self Assessment bill; if it adds up to more than you owe, HMRC refunds the difference. Keep every contractor's statement; it's the evidence behind the figure you claim.
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