CIS for contractors and subcontractors
The Construction Industry Scheme adds a monthly rhythm on top of everything else: deduct, report, and do it again by the 19th. Missing a month is a penalty even when there was nothing to report.
The monthly return, including nil returns
CIS returns are due by the 19th of the month following each tax month, and tax months run from the 6th to the 5th. If you paid no subcontractors in a month you still file, as a nil return. Taxmo puts all twelve dates on your calendar once you have subcontractors on file.
Deductions are not a cost
A deduction taken from a subcontractor is tax paid on their behalf, and it counts towards their own bill. On the subcontractor's side, deductions suffered reduce what they owe at Self Assessment, and can produce a repayment. Recording them properly is what turns them from a mystery shortfall into an offset.
The VAT reverse charge
Construction services between VAT-registered businesses in the scheme are usually subject to the domestic reverse charge, meaning the customer accounts for the VAT rather than the supplier. The invoice goes out without VAT and states that the reverse charge applies. This changes what appears on your VAT return, not just the invoice wording.
Common questions
When is my CIS return due?
By the 19th of the month after the tax month it covers. The tax month running 6 April to 5 May is reported by 19 May. A nil return is still required for months with no payments.
What rate is deducted?
It depends on the subcontractor's verification status with HMRC: a standard rate for those registered under the scheme, a higher rate for those not verified, and gross payment status for some. Verify each subcontractor with HMRC rather than assuming, since the rate follows their status and not your relationship with them.
Do I need CIS if I am a sole trader subcontractor?
You do not file the monthly returns, your contractor does. What matters on your side is recording the deductions suffered, because they offset your Self Assessment bill and are commonly missed.
Last updated 2026-04-25. Thresholds, rates and allowances are indexed or reset at fiscal events and are deliberately not quoted here; check GOV.UK for current amounts.