Construction Industry Scheme (CIS) - Everything you need to know!

To be aware of all the important things about Construction Industry Scheme (CIS), you should read our guided article below which will let you know what is CIS and how to register your company with the CIS scheme.

Knowing CIS

Being under the CIS scheme, a contractor will make all the payments to the subcontractors keeping the accountability of tax status of those subcontractors from HMRC. As a contractor or a limited company, you will deduct the tax amount from the payments of your subcontractors which you will pay to HMRC.

The deductions should be made according to the National Insurance and taxation cost of the subcontractor By registering with the CIS, a contractor or a subcontractor will avail the reduced taxation cost by HMRC. For now, a registered contractor or subcontractor have to pay 20% while unregistered companies will have to pay 30%.

Eligibility for Being a Contractor or Subcontractor
To be able to recognize as a contractor, you will have to follow these rules.
  • If you are paying subcontractors for any construction project.
  • If you are spending more than 1million over the construction work.
  • If you have spent 3-years of a period in jobs and spent money on construction but you don’t work in any construction industry.
  • If you are working for a contractor. 
You can only become a contractor if you fall in these categories. Being a contractor, you should register with the CIS scheme to avoid the huge costs of tax accountants London.


CIS Working Conditions
All kind of construction work falls under the CIS scheme. Any work of civil engineering including road construction, buildings, or bridges is the CIS registered works. Some of the works that are related to
  • Construction also falls under CIS.
  • Construction work preparations.
  • Building works other than complete constructions including repairs or extensions.
  • New systems set-ups including air-conditioning, central heaters, or power systems.
  • Demolition or dismantling work on the construction site.
  • Professional cleaning after the construction.
All of these works are also a part of CIS and they can be a part of payments as well. For further information,  you can find some cheap accountants who would tell you the exact details about the jurisdiction.

Works that are not Eligible for CIS

Apart from construction works, there are some co-related doings that are exempt from CIS.
Surveys or interior designing tasks.
Any hire that doesn’t include labor
Construction material creations.
Delivery services and any kind of canteen and snack vans. 


How to Register for CIS
Registering with CIS will reduce your taxation cost and you will be able to pay your tax directly to HMRC. Any business or a limited company can register with the CIS scheme. A sole trader is also eligible to register with HMRC. For sole traders, it’s very convenient to hire accountants for self-employed London, who will work harder for low charges. 

To register with CIS, you will have to fully register your company to HMRC first. You can do this online and if you chose to apply for self-assessment as a subcontractor, then you will automatically be registered to CIS as well. It's easy and it's very helpful.




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