Under the Construction Industry Scheme (CIS), contractors deduct money from a subcontractor’s payments and pass it to HM Revenue and Customs (HMRC). The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
Contractors must register for the scheme. Subcontractors don’t have to register, but deductions are taken from their payments at a higher rate if they’re not registered.
Register as a contractor if either:
Register as a subcontractor if you do construction work for a contractor.
You must register as both if you fall under both categories.
CIS covers most construction work to buildings, including site preparation, decorating and refurbishment.
You don’t have to register if you only do certain jobs, including:
HMRC's CIS guide for contractors and subcontractors explains what is and isn’t covered by the scheme, the guide can be found here
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