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Construction Industry Scheme (CIS)

What is CIS (Construction Industry Scheme) status and why am I asked to provide this?

The Construction Industry Scheme (CIS) is a system where contractors deduct money from a subcontractor’s payments and pass it to Her Majesty’s Revenue and Customs (HMRC).

Contractors (like our B2B partners) must register with HMRC for this scheme. Subcontractors (Plentific Pros) don’t have to register. However, deductions can be taken from their payments at a higher rate if they are not.

You only need to let us know your CIS status if you want to take on certain leads from our partners. Telling Plentific what your status is will make you eligible for such leads, as it will enable our partners to process your invoices correctly. We will need your unique taxpayer reference (UTR) number to cross reference the information you provide to us.

Deduction types

Payment after deduction of tax at 20% – most ‘labour only’ subcontractors will have tax deducted at a flat rate of 20%. This means that HMRC has found your UTR on its list of CIS subcontractors and verified your status.

Payment after deduction of tax at 30%. If 30% tax is deducted from your payment, this means either that you haven’t given your employer a UTR, or that HMRC couldn’t find your UTR on its list of registered subcontractors. In either case, you should contact HMRC and make sure that you are correctly registered both as self-employed and a CIS subcontractor.

Gross payment – That is no tax deducted. You can only receive gross payments if you pass certain tests including a minimum turnover test and a check to make sure you have a history of meeting your tax obligations.  Consequently, this will only apply to larger subcontractors who have specifically asked HMRC to be paid without a deduction of tax at source. Such subcontractors’ tax affairs are reviewed on an annual basis by HMRC to ensure that they continue to meet the requirements.

The deduction doesn’t apply to any part of a payment that is for the cost for:

  • Materials
  • VAT

Register for sole traders:

If you’re a sole trader and you already have a UTR you can register for CIS online by logging in with your Government Gateway ID.

If you don’t have a UTR, register as a new business for Self Assessment and choose ‘working as a subcontractor’ when prompted. You’ll be registered for Self Assessment and CIS at the same time.

Register for limited companies and partnerships

Fill in the online form for limited companies or the online form for partnerships.

What is a UTR number?

A UTR (Unique Taxpayer Reference) number or tax reference is a 10 digit code that's unique to either you or your company. Your UTR number identifies your business or you personally with HMRC for anything related to your tax obligations.

Where can I find my UTR number?

There are a number of ways of finding your UTR number if you already have one. It’s 10 digits in length and is quoted on previous tax returns and other documents from HMRC, including

  • Your "Welcome to self-assessment" letter (SA250)
  • Your self-assessment tax return
  • Notice to file a tax return
  • Statement of account
  • Payment reminders

If you have registered for the online services area of the HMRC website you can log in and find your UTR number there.

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