The Construction Industry Scheme (CIS) plays a critical role in how tax is handled within the UK construction sector. Whether you are a contractor or subcontractor, CIS compliance is not optional—it is a legal requirement that must be managed accurately to avoid overpayments, penalties, or HMRC investigations.
At Zayn Accountants, we provide expert CIS accounting services in London, helping construction businesses remain compliant while reducing unnecessary tax deductions and improving cash flow.
If you operate within the construction industry, CIS is likely to apply to you. Contractors are required to register for CIS, while subcontractors are not legally required to register—but failure to do so results in higher tax deductions from payments received.
CIS applies to:
Contractors engaging subcontractors for construction work
Subcontractors providing construction services
Labour agencies supplying construction workers
Property developers and gang leaders
Housing associations and local authorities
Non-construction businesses spending more than £1 million annually on construction activities
Even if construction is not your primary business activity, CIS rules may still apply if you incur significant construction-related costs each year.
Under CIS, subcontractors must be verified by contractors before payments are made. If a subcontractor is not verified or registered, tax deductions are applied at a higher rate.
Failure to comply with CIS obligations can result in:
Excessive tax deductions
Delayed payments
Penalties from HMRC
Cash flow issues
Our CIS accountants ensure all registrations, verifications, and reporting obligations are handled correctly and on time.
CIS tax deductions can vary depending on the subcontractor’s status. The deduction rates range from 0% to 30%, depending on registration, verification, and compliance history.
CIS tax calculations are complex and must be handled carefully to ensure:
You are not overtaxed
Deductions are applied correctly
Rebates and refunds are claimed in full
While CIS is designed to reduce tax evasion, proper planning allows businesses to legally minimise tax liabilities and improve cash flow.
At Zayn Accountants, CIS accounting is a core service. Our experienced tax specialists manage the entire CIS process, ensuring accuracy, compliance, and tax efficiency.
Our CIS services include:
CIS registration for contractors and subcontractors
Subcontractor verification with HMRC
CIS monthly returns preparation and submission
Accurate record-keeping in line with CIS regulations
VAT registration advice and integration with CIS
Tailored tax planning to reduce deductions
CIS tax refunds and rebate claims
For example, an unverified and non-VAT-registered subcontractor may face deductions of up to 30%. With proper verification and VAT registration, CIS deductions can be reduced significantly—or eliminated entirely where applicable.
