CIS
If you’re a registered contractor of the Construction Industry Scheme, it’s important to manage your subcontractor invoices correctly.
If you don't, it can be costly in more ways than one.

Not only could you be fined by HMRC for late penalties, but as the business owner, you are also liable for the CIS deduction for your subbies. This can be a huge financial burden if you're not careful. There are a few things you can do to help manage your CIS correctly and avoid any costly penalties.

First, make sure you keep track of all your subbies' invoices and payments. This will help you stay on top of who owes what, and when the payments are due.

Second, set up a system for deducting the CIS from your subbies' invoices.

That’s where Tradermate come in. We can manage your CIS for you through the Xero CIS add on. Subbies can be added and verified all in the system, giving you correct deductions and payment amounts. Finally, be sure to pay your subbies on time. This will help avoid any late penalties from HMRC.

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Not only could you be fined by HMRC for late penalties, but as the business owner, you are also liable for the CIS deduction for your subbies. This can be a huge financial burden if you're not careful.
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Here is what we get asked most...
What is Construction Industry Scheme?
Under the Construction Industry Scheme, contractors deduct money from subcontractors’ payments, and pass it to HMRC. These deductions count as advance payments toward the subcontractors’ tax and National Insurance.
How does the Construction Industry Scheme Work?
When a subcontractor invoices you, you deduct the relevant rate of CIS deductions from the labour element of their invoice and pay the balance. The money you’ve kept back is reported to and paid to HMRC monthly.
Who does the Construction Industry Scheme apply to?

If you use sub-contractors in your business, you must register for the Construction Industry Scheme with HMRC. You are then responsibly for making the appropriate rate of deductions from your subcontractors and paying them over to HMRC.

The Construction Industry Scheme applies to any business

The CIS scheme applies to you if you are either a subcontractor, who hires subcontractors, or you are a subcontractor, or both.

Is the Construction Industry Scheme compulsory?
Not only is the Construction Industry Scheme compulsory, but if any of your CIS returns are late, even by a day, you’ll incur a fixed penalty of £100. The penalty rises to £200 the following month, a further £300 after 6 months, or 5% of any liability that should have been shown on the return.