What is the CIS scheme?

Contractor vs Sub-contractor


The Construction Industry Scheme (CIS) is a tax deduction scheme which involves tax being deducted at source from payments which relate to construction work

The CIS includes sectors such as engineering, demolition, site clearing, repairs and decorating, and installing power systems. The HMRC CIS manual explains what work is included within the Construction Industry Scheme.

The CIS is a HMRC scheme which applies if you work for a contractor in the construction industry but not as an employee, so for example as a self-employed individual. The CIS rules mean that the contractor is usually obliged to withhold tax on its payments to you, at either 20% if you are 'registered' or 30% if you are not.

There are two components of CIS, one is being a 'contractor' and one being a 'subcontractor'.


If you are engaging other self-employed workers doing construction work then you are a contractor and must register under the CIS. There is more information on how to register for the CIS as a contractor on GOV.UK. Subcontractor.


As a self-employed worker, it is more likely that you will be engaged, or taken on, by a contractor to perform some construction work. This will mean you are a subcontractor. If you are a subcontractor, then you can choose whether or not to register under the CIS.

You can apply for gross payment status when you register for CIS . This means contractors will be paid in full, without deductions. Tax and National Insurance at the end of the tax year.

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