The Construction Industry Scheme, the VAT reverse charge and the question of who counts as employed all make construction one of the more demanding sectors for tax. We help contractors and subcontractors stay compliant and keep their cash flowing — with a dedicated named accountant, a fixed monthly fee and cloud-first books that handle CIS as part of the routine, not a monthly scramble.
Construction & CIS
Here's exactly what's involved — and how your own named accountant handles each part for you.
Under CIS, contractors deduct tax from what they pay subcontractors and pass it to HMRC, and the rate depends on the subcontractor's status. Getting the deduction wrong affects both sides, so it pays to have it run properly.
Contractors carry several CIS obligations every month, and the deadlines are fixed. Missing a return brings automatic penalties, so we build the work around the date and keep you ahead of it.
The VAT domestic reverse charge for construction services has applied since 1 March 2021, and it changed how VAT moves between businesses in the supply chain.
Gross payment status lets a subcontractor be paid in full without CIS deductions, which can make a real difference to cash flow. It is not automatic, though — there are tests to pass and a standard to maintain.
Whether a worker is genuinely a subcontractor, an employee or caught by IR35 is a question that comes up constantly in construction, and getting it wrong is expensive.
We run your books in Xero, QuickBooks or Sage with CIS built into the workflow, so deductions, returns and statements are handled as a matter of routine. Joining us is paperless and usually takes a few days, with your records collected under professional clearance.
Last reviewed: June 2026. This page is general guidance, not advice — figures relate to the 2025/26 UK tax year and may change. Please get in touch for advice tailored to your circumstances.
FAQ
It depends on their status. The deduction is 20% for registered subcontractors, 30% where a subcontractor is not verified or registered, and 0% for those with gross payment status. We verify each subcontractor and apply the correct rate for you.
Book a free, no-obligation consultation and we'll show you exactly how MMR can help — with a clear fixed-fee quote and no pressure.
