How to register for CIS

If you carry out any sort of construction work and you’re wondering how to register for CIS (Construction Industry Scheme), we’ve got you covered. Just read on!

What you need to do

To become a CIS contractor or CIS subcontractor, follow these simple steps:

1. Register for HMRC’s online service and enrol for self-employment
2. You’ll get your Government Gateway ID (email) & UTR number (by post)
3. On the official HMRC website, select the option to register for CIS using your government gateway ID
4. Choose your CIS payment status (net pay or gross pay)
5. You’re all good to go! 😎

HMRC operate a CIS helpline as well as online services, so if you need a hand or have a question, you have two options:

• Give them a call on 0300 200 3210
• Ask HMRC’s digital assistant

When contacting HMRC, you’ll want to have your national insurance number to hand and be prepared to answer some security questions.

Why do I need to register for CIS?

If you’re self-employed and working in the construction industry, then you have to register for the Construction Industry Scheme (CIS).

If you don’t, then your wages will have 30% tax deducted from them instead of 20%.

When you register for CIS, deductions are either reduced to 20% or removed altogether. This depends on whether you register for net payment status or gross payment status.

What’s the difference between gross pay and net pay status?

Net payment status

The two main properties of net payment status are that:

• Taxes are withheld and passed to HMRC (at 20% instead of 30%)
• All construction workers can qualify for net payment status

The main benefit of choosing net payment is that your contractor will only withhold 20% of your earnings, instead of 30%. It’s a no brainer for us, really.

It’s still possible to overpay taxes using this route, but you can simply claim a refund.

Gross payment status

• Taxes withheld from your payments: 0%
• You need to meet the qualifications criteria

With gross payment status, HMRC will no longer ask your contractor to withhold tax payments, so it is your responsibility to calculate and pay your taxes via self assessment tax return.

However, not everyone is eligible for gross payment status. To get this status, you need to meet the following criteria:

• You’ve paid your taxes on time in the past
• Your turnover is over £30,000 or more
• You’re making your business payments through a bank account

Need a 👋?

Whether it’s sorting your tax return for you or providing professional tax advice, our accredited accounts are on hand to help. Find out more about our services here.