Construction Industry Scheme (CIS) Registration

As a non-UK construction business looking to accept work on UK construction projects you need to be registered for the UK government's Construction Industry Scheme. Otherwise your customer or the general contractor you work for will deduct up to 30% from any monies they pay you. CIS also applies when you pay sub-contractors on UK construction projects. St Matthew can help you to get registered for CIS and also claim back any deductions that have been made from invoices paid to you.

Fee: £1,600

 

Legal Requirements

The Construction Industry Scheme (CIS) sets out the rules for how payments to subcontractors for construction work must be handled by contractors in the construction industry. This scheme includes workers from overseas. At St Matthew we assist both national and international contractors and subcontractors in all aspects of construction industry applications and documentation.

How do I get paid? How do I pay my workers?

HMRC will tell a customer or general contractor how to pay their sub-contractors. This could be:

  • gross - with no deductions taken off their payment
  • net of a deduction at the standard rate - 20 per cent
  • net of a deduction at the higher rate - 30 per cent

HMRC will also tell the client or general contractor to pay a subcontractor gross if they're registered with them to get gross payments. If the subcontractor is not registered for gross payments, HMRC will tell the payer to make a deduction from their payment at the standard rate as long as they can verify them. If HMRC cannot match the details you gave for them, they will give the payer a special verification reference and tell you to make a deduction at the higher rate.

Initial Registration Process

Essentially there is some filing that St Matthew will take care of for you. You will be required to hand in supporting evidence like company files, contracts etc. If they are not in English they may need to be translated. There is is also a test right at the start of the process as not all constructions businesses are eligible to sign up for CIS.

Ongoing Compliance

Submitting monthly returns will be part of the process. Each month you'll need to send HMRC a monthly return. This tells them about the payments you have made to all your subcontractors - and any deductions you have made from them. If you haven't made any payments, you'll have to make a 'nil return' to let HMRC know.

Remember: If you're a construction industry contractor it's your responsibility to decide on an individual's employment status when you take them on. CIS only applies to construction workers who are self-employed - it doesn't cover employees. So if your contract is a 'contract of employment' then you're an employee and CIS doesn't apply to that contract. Instead you'll pay any tax you owe through the UK's PAYE (Pay As You Earn) system.

What We Will Need From You

  • Your contract details. It may be a building, plumbing, electrical or installation contract. Some 'installation' projects do not fall under the CIS arrangements. We will check this and let you know if it doesn't.
  • Verification of your subcontractors with HMRC.
  • Paying your subcontractors in the right way – making deductions if necessary.
  • Paying over deductions to HMRC – St Matthew can help you with this
  • Your contractor/subcontractor records

Our Services

St Matthew’s services are comprehensive and take almost all of the inconvenience out of the CIS clerical processes. These services include:

  • All form(s) completion Assistance with contract documents – including retaining back-up documents
  • All communications with HMRC and other Government departments
  • Claiming tax refunds (for both current and previous years)
  • Tax refunds for individuals and companies before CIS scheme implementation

Processing Time

You should into consideration that processing can take up to four weeks.