Tax
Corporation Tax UTR: What It Is and How to Find It
Learn what a Corporation Tax UTR is, where to find your company’s 10-digit reference and how to request a copy from HMRC if it’s missing.
CIS Registration for Subcontractors Explained
Learn how to register your construction company for CIS, understand 20% and 30% deductions, and claim back tax withheld by contractors.
By Hugo Brooks5 October 20263 min read
If your construction company carries out work for a contractor, you may be paid under the Construction Industry Scheme (CIS). Under CIS, the contractor deducts money from your payment and sends it to HMRC as an advance payment towards your tax.
Registering normally reduces the deduction rate from 30% to 20%. It doesn’t reduce your final tax bill, but it means less money is withheld from each payment.
Does CIS apply to your work?
CIS covers most construction work, including building, demolition, repairs, decorating and installing heating, electrical or plumbing systems. It generally applies when your business does this work for a contractor. Work directly for a private homeowner is normally outside CIS.
Some activities are excluded, such as architecture, surveying and delivering materials when supplied on their own.
Your SIC code doesn’t determine whether CIS applies. What matters is the work you do and the arrangement with your customer. Incorporation doesn’t automatically register your company for CIS.
Do subcontractors have to register?
Registration isn’t compulsory for subcontractors, but being unregistered normally means higher deductions.
Your status | CIS deduction rate |
|---|---|
Registered and successfully verified by the contractor | 20% |
Unregistered, or unable to be verified | 30% |
Approved for gross payment status | 0% |
Gross payment status requires a separate application and HMRC approval. You still have to account for and pay your tax.
For example, on a £1,000 labour-only invoice with no VAT, a registered subcontractor normally receives £800, with £200 sent to HMRC. An unregistered subcontractor receives £700.
CIS deductions aren’t normally taken from VAT or the qualifying cost of materials you paid for directly. Keep supporting invoices.
How do you register?
Use HMRC’s CIS subcontractor registration service. For a limited company, have these details ready:
The company’s legal name.
Its Corporation Tax UTR.
Its company registration number.
Its trading start date.
Its VAT registration number, if registered.
Register the company that invoices the contractor. If you previously registered as a sole trader, that registration doesn’t cover your new limited company. Our Corporation Tax UTR guide explains where to find the company’s reference. Give contractors the same details you used to register so they can verify your business before payment.
How do you recover the deductions?
Keep the contractor’s payment and deduction statements.
Limited companies report CIS deductions suffered through an Employer Payment Summary (EPS) and offset them against liabilities through their PAYE scheme. Remaining deductions may be refundable after the tax year ends.
Don’t claim them through your Corporation Tax return or your director’s personal Self Assessment return.
Our PAYE registration guide explains employer registration. An accountant can help set up the CIS reporting correctly.
What else should you check?
If you also pay other subcontractors for construction work, you must register as a CIS contractor as well and meet the contractor reporting duties. CIS and VAT are separate. If you’re VAT registered, check whether the construction VAT domestic reverse charge applies before invoicing.
For help managing deductions, invoices and returns, read when founders need an accountant.
