{"id":2035,"date":"2023-03-13T04:04:21","date_gmt":"2023-03-13T04:04:21","guid":{"rendered":"https:\/\/www.theukrules.co.uk\/?page_id=2035"},"modified":"2023-09-06T05:48:58","modified_gmt":"2023-09-06T05:48:58","slug":"contractor","status":"publish","type":"page","link":"https:\/\/www.theukrules.co.uk\/rules\/business\/tax\/construction-industry-scheme\/contractor\/","title":{"rendered":"Your Obligations as a Construction Industry Scheme (CIS) Contractor"},"content":{"rendered":"<p>This section explains the rules that CIS contractors must follow and their obligations in the construction industry.<\/p>\n<p>You will need to register as a contractor with the Construction Industry Scheme (CIS) if:<\/p>\n<ul>\n<li>You make payments to subcontractors for doing construction work.<\/li>\n<li>Your business does not carry out construction work but you usually spend over \u00a31 million per year on construction.<\/li>\n<\/ul>\n<p>Your obligations as a CIS contractor would still apply whether you are a sole trader, in a business partnership, or you own a limited company.<\/p>\n<p>The CIS scheme covers all types of construction work carried out in the United Kingdom. It includes jobs such as site preparation, making alterations, dismantling, and demolition.<\/p>\n<p>CIS contractor regulations also include UK territorial waters up to the 12-mile limit. Check who the scheme covers if you are unsure whether you need to register (see below).<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h3>CIS Contractor Rules You Must Follow<\/h3>\n<ol>\n<li>As a contractor, you must register with HM Revenue and Customs for the CIS scheme before taking on any subcontractors.<\/li>\n<li>You may need to employ the person in &#8216;<a href=\"\/rules\/employment\/employing\/contracts\/employment-status\/employee\/\">employee status<\/a>&#8216; instead of subcontracting the work to them. You can get a penalty if you should have taken them on as an employee instead (see below).<\/li>\n<li>You will need to verify subcontractors with HM Revenue and Customs (HMRC). Checking the registration of a subcontractor with CIS is one of the roles of CIS contractors.<\/li>\n<li>As a rule, you will pay the workers and make deductions from any subcontractor payments. The deductions you make count as advance payments towards a subcontractor&#8217;s tax and National Insurance bill. You need to pay this money to HMRC.<\/li>\n<li>You must file monthly returns and keep full CIS records to avoid getting a financial penalty.<\/li>\n<li>You would need to notify HM Revenue and Customs if there are any changes to your company (e.g. address or business structure).<\/li>\n<\/ol>\n<p><strong>Note<\/strong>: Read <a href=\"https:\/\/www.gov.uk\/government\/publications\/construction-industry-scheme-cis-340\" target=\"_blank\" rel=\"noreferrer noopener\">CIS 340 guidance<\/a> for further details on the payment rules to subcontractors for construction work. It also explains the duties of contractors and subcontractors within the <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/\">Construction Industry Scheme (CIS)<\/a>.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h3>ALSO IN THIS SECTION<\/h3>\n<div class=\"category-wrapper\">\n<div class=\"list-content\">\n<h5>Businesses Covered in CIS Scheme<\/h5>\n<p>The Construction Industry Scheme (CIS) includes mainstream contractors and deemed contractors. Check <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/who-cis-covers\/\">who is covered by CIS<\/a> and what kind of work qualifies as exceptions for contractors.<\/p>\n<\/p><\/div>\n<div class=\"list-content\">\n<h5>How to Register for CIS Scheme<\/h5>\n<p>Taking on, and paying, subcontractors means you must <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/registration\/\">register for HMRC CIS scheme<\/a>. Get expert help with registering for CIS and information on <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/registration\/\">verifying subcontractors<\/a>.<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<div class=\"category-wrapper\">\n<div class=\"list-content\">\n<h5>CIS Deductions and Payment<\/h5>\n<p>As a CIS contractor, you can make <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/deductions-and-payments\/\">deductions and pay subcontractors<\/a> for construction work. The section explains how to make a CIS deduction and pay deductions to HMRC.<\/p>\n<\/p><\/div>\n<div class=\"list-content\">\n<h5>Filing CIS Monthly Returns<\/h5>\n<p>As a mainstream CIS contractor, you must <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/monthly-return\/\">file monthly returns online<\/a> with HM Revenue and Customs. You can also use commercial CIS software but there are penalties for filing late returns.<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<div class=\"category-wrapper\">\n<div class=\"list-content\">\n<h5>CIS Record Keeping<\/h5>\n<p>You must <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/record-keeping\/\">keep CIS records<\/a> for three (3) years and <a href=\"\/rules\/business\/tax\/construction-industry-scheme\/contractor\/record-keeping\/\">tell HMRC about changes<\/a> in circumstances. Check what to do if you stop trading or stop using subcontractors.<\/p>\n<\/div><\/div>\n<p><\/p>\n<hr>\n<p><\/p>\n<div class=\"updated-data\">\n  <strong>What You Must Do as a Construction Industry Scheme (CIS) Contractor in United Kingdom<\/strong><br \/>\n  <time datetime=\"2022-01-01\">Last Updated 2022<\/time>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>This section explains the rules that CIS contractors must follow and their obligations in the construction industry. You will need to register as a contractor with the Construction Industry Scheme (CIS) if: You make payments to subcontractors for doing construction work. Your business does not carry out construction work but you usually spend over \u00a31&hellip; <a class=\"more-link\" href=\"https:\/\/www.theukrules.co.uk\/rules\/business\/tax\/construction-industry-scheme\/contractor\/\">Continue reading <span class=\"screen-reader-text\">Your Obligations as a Construction Industry Scheme (CIS) Contractor<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"parent":2004,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"inline_featured_image":false,"footnotes":""},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Your Obligations as a Construction Industry Scheme (CIS) Contractor - UK Rules<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.theukrules.co.uk\/rules\/business\/tax\/construction-industry-scheme\/contractor\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Your Obligations as a Construction Industry Scheme (CIS) Contractor - UK Rules\" \/>\n<meta property=\"og:description\" content=\"This section explains the rules that CIS contractors must follow and their obligations in the construction industry. 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