A Step-by-Step Guide to CIS Registration Online

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If you’ve made a mistake on your self-assessment tax return, don’t panic—you can correct it even after submission. This guide will walk you through how to amend your tax return, regardless of the reason, and explain the time frame for making these changes.

Friendly Disclaimer: While I am an accountant, this information is provided for general guidance and may not cover your specific circumstances. Consult a qualified professional for personalized advice to avoid potential penalties.

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Table of Contents

1. Understanding the Construction Industry Scheme (CIS)

2. Are CIS Subcontractors Considered Self-Employed?

3. Do You Need to Register as a Subcontractor?

   • Who Doesn’t Need to Register?

4. How to Apply for CIS Registration

   • Registering as Self-Employed Online

   • Registering as a CIS Subcontractor Online

5. Step-by-Step Guide to CIS Registration Online

6. What is CIS Gross Payment Status?

   • Who Qualifies for CIS Gross Payment Status?

   • How to Apply for CIS Gross Payment Status

7. How to Register by Phone

8. How Long Does It Take to Apply for CIS Online?

9. Consequences of Failing to Register as a CIS Subcontractor

10. What Happens After You’re Registered as a CIS Subcontractor

11. What is a CIS Payment and Deduction Statement?

12. CIS Invoice Template for Subcontractors

13. Allowable Expenses for CIS Contractors

14. Can I Get Paid Without a UTR?

 

1. Understanding the Construction Industry Scheme (CIS)

The Construction Industry Scheme (CIS) affects contractors who employ self-employed subcontractors in the UK. Contractors are required to deduct a fixed percentage from payments made to subcontractors:

• 20% for registered subcontractors

• 30% for those not registered

This deduction is a prepayment of tax and National Insurance contributions, which is paid directly to HMRC on the subcontractor’s behalf.

 

2. Are CIS Subcontractors Considered Self-Employed?

CIS subcontractors are considered self-employed. The main difference under CIS is the tax deduction made by contractors, which is specific to the construction industry. Self-employed individuals generally do not face this deduction.

Regardless of being a subcontractor or self-employed, you must:

• Keep records of income and expenses

• Calculate and pay taxes twice a year

• Submit a tax return by 31 January each year

 

3. Do You Need to Register as a Subcontractor?

If you work in construction and need to register, here’s what you need to know:

• Construction Work Includes: Site preparation, demolition, building, alterations, decorating, and civil engineering.

• Exempt Trades: Architecture, surveying, scaffolding hire (without labor), carpet fitting, and certain other non-construction work.

If in doubt, contact the HMRC CIS Helpline at 0300 200 3210.

 

4. How to Apply for CIS Registration

Registering as Self-Employed Online:

1. Visit the HMRC website and choose “Register Online.”

2. Set up your HMRC online account.

3. Enroll for self-assessment online.

4. Await your UTR number and activation code (up to 10 days).

 

Registering as a CIS Subcontractor Online:

1. Ensure you have your UTR number and HMRC login details.

2. Visit the HMRC website and select “Register for CIS Online.”

3. Complete the CIS registration form.

 

5. Step-by-Step Guide to CIS Registration Online

1. Choose Payment Status: Decide whether to register for net or gross CIS payments.

2. Enter Personal Details: Include your National Insurance number and verify your UTR number.

3. Provide Business Details: Include details about your self-employment and previous subcontractor payments.

4. Enter Trading Details: If applicable, provide your trading name and address.

5. Review and Confirm: Check all information for accuracy and accept the declaration.

 

6. What is CIS Gross Payment Status?

Subcontractors with CIS Gross Payment Status receive full payments without deductions. They are responsible for paying their taxes and National Insurance contributions directly.

 

Eligibility for Gross Payment Status:

• Timely payment of taxes and National Insurance

• Active in the UK construction industry

• Business turnover must exceed £30,000 (excluding VAT and material costs)

 

Application:

• Apply during CIS registration online or call the HMRC CIS Helpline at 0300 200 3210.

 

7. How to Register by Phone

If online registration is not an option, call the HMRC CIS Registration phone line at 0300 200 3210.

 

8. How Long Does It Take to Apply for CIS Online?

Registering as a subcontractor can take a few days if you’re already self-employed. If not, allow up to 10 days to receive your UTR number before registering as a CIS subcontractor.

 

9. Consequences of Failing to Register as a CIS Subcontractor

Failure to register can result in:

• 30% tax deduction from your pay

• £100 penalty for not registering as self-employed

• Additional penalties for not submitting tax returns

 

10. What Happens After You’re Registered as a CIS Subcontractor

Upon registration, you will:

• Receive your CIS number

• Invoice contractors for work completed

• Keep track of CIS statements and tax deductions

• Submit a tax return and pay taxes by 31 January each year

• Maintain records for six years

 

11. What is a CIS Payment and Deduction Statement?

A CIS statement summarizes your payments and deductions from contractors. Ensure you receive and keep these statements as they are essential for filing your tax return.

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12. CIS Invoice Template for Subcontractors

Download a CIS invoice template to issue to contractors. Remember, CIS deductions should only apply to labor costs, not materials.

 

13. Allowable Expenses for CIS Contractors

Typical expenses include:

• Tools, materials, safety equipment

• Certain clothing, food, mileage

• Home office, mobile phone (business use), accountant fees, bank charges

Keep all receipts to claim these expenses and potentially receive a tax refund.

 

14. Can I Get Paid Without a UTR?

You should not need to provide your UTR to receive payment. If requested, explain that you are self-employed and will submit an invoice without disclosing your UTR.

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