CIS payment and deduction statements

What is a CIS payment and deduction statement?

It is the subcontractor’s proof of what you paid them and the tax you took off. It is not optional. CIS340, HMRC’s guide to the scheme, says The contractor must provide a written statement to every subcontractor from whom a deduction has been made within 14 days of the end of each tax month.

You can give one statement for the whole month or one for each payment: The statement can be issued on the basis of one for each tax month or one for each payment if this is more frequent.

Giving the statement is one of six monthly jobs for a contractor. See how CIS works for the other five.

When must a CIS statement be given?

By the 19th of the month after each tax month. A tax month runs from the 6th of one month to the 5th of the next, and GOV.UK gives this example: If the tax month was 6 May to 5 June, you must give the statement by 19 June.

That is the same day your monthly CIS return is due, so it makes sense to do both together. CIS monthly returns and deadlines

What must a CIS statement include?

Six things, every time. CIS340 says Contractors can choose the style of the statements but they must include the:

• Your name and employer tax reference
• The end date of the tax month, or the payment date if the statement covers one payment
• The subcontractor’s name and Unique Taxpayer Reference (UTR)
• The gross amount paid, before the deduction and without VAT
• The cost of any materials taken off before the deduction was worked out
• The amount deducted

Source: CIS340, paragraph 3.15.

A seventh, the verification number, goes on only when you deducted at the higher rate of 30% because HMRC could not match the subcontractor. CIS340 asks for the personal verification number if the subcontractor could not be verified and a deduction at the higher rate has been made. On a statement at the standard rate it is left off. How verification works

You can add more to help them follow it. CIS340 suggests VAT: this may include the amount of VAT charged by the subcontractor. HMRC’s own form also shows the amount paid after the deduction, the net payment the subcontractor actually received.

The statement always goes in the subcontractor’s name, even if they ask you to pay someone else, such as a relative or a debt company: The statement must still be made out in the name of the subcontractor and issued to the subcontractor so they receive credit for any deduction.

Is there a CIS statement template?

Yes. HMRC publishes a one page payment and deduction statement form, but you do not have to use it. Any layout is fine, from your own spreadsheet to your software, as long as the six things above are on it. Or use our free template below: put in your figures and print it.

What does a CIS statement look like filled in?

Here is one laid out like HMRC’s form. The subcontractor is a groundworker verified at 20%, who invoiced £1,600 in the tax month, £400 of it materials they bought themselves. It is the same invoice we work through in our guide to how CIS deductions work.

The contractor must give this to the subcontractor by 19 June 2026. The £240 taken off counts towards the subcontractor’s tax bill for the year.

To check a single invoice, use the CIS deduction calculator.

Make a CIS statement for your subcontractor

Put in the payments for one subcontractor and one tax month, then print it or save it as a PDF. The deduction is worked out for you.

Can I email a CIS statement?

Yes, as long as two things are true. CIS340 allows it only where the:

• contractor and subcontractor agree to this method
• statement is in a form that allows the subcontractor to store and print it

A PDF they can save and print does both. Agree it with them first.

Do subcontractors paid gross get a statement?

You do not have to give one, because nothing was deducted. It is still worth doing, and CIS340 says so: It’s good practice for a contractor to give a subcontractor a payment statement where the payment has been made gross, but there is no obligation to do so.

What happens if a contractor does not give CIS statements?

HMRC can charge a penalty. CIS340 says We may charge contractors penalties of up to £3,000 if they:

• fail to give statements to subcontractors registered for payment under deduction, recording their payments and deductions
• negligently or deliberately provide incorrect information in such statements

Source: CIS340, paragraph 4.20.

If you hold gross payment status yourself, missing statements regularly can count against it: this may be taken into account when considering whether or not the contractor should retain gross payment status as a subcontractor.

What does a subcontractor do with a CIS statement?

Keeps it, and uses it to claim the deductions back at the end of the tax year. GOV.UK tells subcontractors You’ll need the monthly payment and deduction statements your contractor has given you, and warns that HMRC might ask for evidence of your deductions.

Sole traders and partners put their total pay and total deductions on their Self Assessment return. Limited companies take the deductions off what they owe through their payroll scheme. Check each statement against what reached your bank account when it arrives, not in January. How to claim a CIS refund

What if a CIS statement is missing or wrong?

Go back to the contractor first. Writing to HMRC is the last step, for when the contractor cannot give it to you.

1. Ask the contractor for it. GOV.UK’s advice when a statement has not arrived is simple: If they do not, ask them for it. The same goes for a lost one: If you lose any statements, ask your contractor for a replacement.
2. Expect the copy to say Duplicate. A replacement for a lost statement must be marked, so nobody mistakes it for a second payment: the duplicate must be clearly marked ‘Duplicate’ to avoid any confusion with the missing statement if it’s later found.
3. If the figures look wrong, speak to the contractor. If you think the figures are incorrect, speak to your contractor, says GOV.UK. If the mistake is the contractor’s, their monthly return may carry it too, and they correct it with HMRC. How to correct a CIS return
4. If you cannot get them at all, write to HMRC. GOV.UK says to do this when the contractor cannot give them to you, for example because your contractor has gone out of business. Include:
   • your name, address and Unique Taxpayer Reference (UTR)
   • the name and address of the contractor
   • the contractor’s tax reference - if you know it
   • the dates of the payments or the tax months when the contractor paid you
   • the reason why you do not have statements or duplicates
   Send it to PT Operations, HM Revenue and Customs, BX9 1BX.

Source: GOV.UK, What you must do as a CIS subcontractor.

What to do now

• Verify each new subcontractor before you pay them, so you know which rate to take off. How to verify
• Work out the deduction on everything except the materials and costs they paid for. Travel and subsistence you pay them stay in.
• Make a statement for everyone you deducted from, with the template above or your own layout.
• Give it to them by the 19th, the day your CIS return is due, and keep a copy.