Bookkeeping for contractors who pay subcontractors
If you pay subcontractors, we work out every CIS deduction, prepare a statement for each subcontractor and have your monthly CIS return ready before the 19th. You check it and send it, and we keep track of the dates for you.
Am I a contractor under CIS?
If you pay someone else to do construction work for your business, you are a contractor under the Construction Industry Scheme (CIS), whatever your trade. Builders, groundworkers and scaffolders count. So does an electrician who subcontracts a rewire, a plumber who passes on overflow work, a roofer who pays two labourers, or a joiner on a fit out.
There is no minimum. Paying one labourer for a fortnight gives you the same monthly CIS jobs as a firm with twenty subcontractors. Read how CIS works, step by step
You can also be a contractor and a subcontractor at once: the contractor above you takes deductions from what they pay you, and you take deductions from the subcontractors you pay. That is common, and we record both sides in your books, so what is taken off you and what you take off others are each easy to see.
What does a contractor have to do for CIS each month?
Each step has its own deadline, and it all still has to be done in your busiest months.
One month of CIS, from the end of the tax month to paying HMRC. Sending the return and paying are separate deadlines, three days apart.
| When | What has to happen |
|---|---|
| Before you pay anyone new | Check them with HMRC (called verifying), which tells you whether to deduct 0, 20 or 30 percent |
| Every invoice | Split the labour from the materials, and take the deduction off the labour only |
| Every payment | Record what you paid and what you deducted |
| Within 14 days of the 5th | Pass a payment and deduction statement to every subcontractor you took a deduction from (we prepare them) |
| By the 19th | Your monthly CIS return (the CIS300) reaches HMRC, even in a month you paid nobody |
| By the 22nd | The money you deducted reaches HMRC, if you pay electronically. If the 22nd is a weekend or bank holiday, it must arrive by the working day before |
A late return costs £100 the day after the deadline, and that includes a nil return (the return for a month when you paid nobody). The bigger risk is getting the labour and materials split wrong, or paying someone before checking them with HMRC. Any shortfall is then yours to pay, not the subcontractor's.
We do this monthly CIS work for you. Tell us how many subcontractors you pay and we will tell you what we would take on.
Get in touchWhat we do, and what stays with you
We are bookkeepers for builders and construction companies, not accountants. We do the monthly work, and your year end accounts stay with your accountant.
Your CIS return: we prepare it, you send it
We work out every deduction, prepare a statement for each subcontractor, and have your CIS return checked and ready before the 19th. You send it from your own HMRC account. How our monthly CIS service works
Your VAT return: we prepare it and file it once you approve it
This includes the construction reverse charge, where you account for the VAT on your own return instead of your subcontractor charging it. We check it invoice by invoice. The reverse charge explained
Your monthly books
Your bank kept up to date, receipts matched, your mileage log kept with your books, and a tidy set of books handed to your accountant at year end. Each month you also see your cash thirteen weeks ahead, and what each job has cost and brought in so far. Monthly bookkeeping and catch-up bookkeeping if you are behind
If you have employees as well as subcontractors, we run your payroll too and file it once you have approved the pay run. Payroll for construction firms
Common questions about CIS for contractors
Am I a contractor if I only pay one or two subcontractors?
Yes. There is no minimum. If you pay anyone else to do construction work for your business, you are a contractor under CIS and you must register before you pay them for the first time. Someone who takes on one labourer for a fortnight has the same monthly jobs as a firm with twenty subcontractors.
I am an electrician, not a builder. Does CIS still apply?
Yes, if you pay someone else to do the work. CIS depends on the type of work, not on what you call your trade. Electrical installation is on HMRC's list of construction work, so an electrician who subcontracts work is in the scheme. The same goes for a plumber, roofer, joiner or plasterer who pays others.
What does a contractor have to do for CIS every month?
Check anyone new with HMRC, split the labour from the materials on each invoice, and take the deduction off the labour only. Each subcontractor needs a payment and deduction statement within 14 days of the end of the tax month (we prepare them and you pass them on). Your monthly CIS return (the CIS300) is due by the 19th, and what you deducted is due by the 22nd if you pay electronically, or by the working day before if the 22nd is a weekend or bank holiday. It happens twelve times a year, whether work is busy or not.
Do I need a CIS return in a month when I paid nobody?
Yes, and this is where penalties often come from. HMRC expects a nil return for any month with no payments, and a late nil return gets the same £100 penalty as any other return. Instead, you can tell HMRC you are inactive, which pauses your returns for up to six months.
Do you file my CIS return for me?
We prepare it, check it and hand it to you ready to send, and you send it from your own HMRC account. That way nothing reaches HMRC that you have not seen. Your VAT return is different: we prepare it and file it once you approve it.
Do contractors need an accountant?
Not for the monthly work. CIS, VAT returns, payroll and keeping the books up to date are bookkeeping, and that is what we do for you every month. Once a year your accounts and tax return are done from those books, and most firms give that job to an accountant. We hand them a finished, tidy set of books, so there is less for them to sort out.
What if I am behind on my CIS and my books?
That is common, and we can fix it. Catching up your books first is a normal way to start, and it is better to sort it now than to find the gaps months later when your year end accounts are being done.
Primary sources and further reading
If HMRC and this page ever disagree, HMRC is right. Tell us and we will fix it.
Join the waitlist for 2027
Join the waitlist for 2027. Tell us how many subcontractors you pay and we will tell you what we would take on and give you a fixed monthly price.
We pay any HMRC penalty we cause, except on the CIS300, which you submit yourself.