Geoffrey Caesar, Solicitor

If you are a contractor in the construction industry, you may be wondering how to register for the Construction Industry Scheme (CIS). CIS is a special tax regime for contractors and subcontractors in the construction sector. Under CIS, contractors deduct money from a subcontractor’s payments and pass it to HM Revenue & Customs (HMRC). The deductions count as advance payments towards the subcontractor’s PAYE and NICs.

To register for CIS, you need to follow these steps:

• Check if you are a contractor or a subcontractor under the scheme. A contractor is a business or other concern that pays subcontractors for construction work. A subcontractor is a business that carries out construction work for a contractor. Depending on your work, you can be both a contractor and a subcontractor.
• Check if you need to register as a contractor, a subcontractor or both. You must register as a contractor if you pay subcontractors for construction work or if your business does not do construction work, but you have spent more than £3 million on construction in the 12 months since you made your first payment. You must register as a subcontractor if you do construction work for a contractor.
• Register online, by phone or by post with HMRC. You will need to provide your legal business name, National Insurance number, unique taxpayer reference (UTR) number, and VAT registration number if you are VAT registered. You will also need to provide your business address, contact details and bank account details.
• Receive your verification number from HMRC. This is a unique number that confirms your status as a contractor or a subcontractor and the rate of deduction that applies to you. You will need to give this number to each contractor or subcontractor you work for or pay, along with your UTR number and legal business name.

Once registered for CIS, you must keep records of your payments and deductions under the scheme and file monthly returns to HMRC. You can claim back any overpaid tax and NICs through your Self-assessment tax return at the end of the year.

Registering for CIS is essential for contractors and subcontractors in the construction industry. The scheme is designed to ensure fairness and compliance in the tax system, but it can also have significant implications for your income and expenses.

Need help with how to register or need more guidance? I can provide further information, review any documents you have been sent and draw up any contracts you may require.