CIS and Self Assessment

Key facts

CIS subcontractors who are sole traders report construction income on their Self Assessment return (SA100).
CIS deductions suffered are entered on the self-employment pages (SA103S or SA103F) and offset against your tax liability.
If CIS deductions exceed your total tax bill, you receive a refund from HMRC.
You must register for Self Assessment and file a return by 31 January following the end of the tax year.
Your gross construction income (before CIS deductions) is reported as business turnover.

How CIS and Self Assessment Work Together

The Construction Industry Scheme (CIS) requires contractors to deduct tax at source from payments to subcontractors and pass it to HMRC. These deductions are not a final tax charge — they are advance payments towards your annual Income Tax and National Insurance liability.^[2]

Self Assessment is the mechanism through which your actual tax liability is calculated and any over- or under-payment of CIS deductions is reconciled. Filing an accurate Self Assessment return is essential to ensuring you pay the correct amount of tax and reclaim any excess CIS deductions.

Registering for Self Assessment

If you are a self-employed CIS subcontractor, you must:^[1]

Register for Self Assessment with HMRC (form SA1 online or by post)
Register by 5 October following the end of the tax year in which you started working as a subcontractor
File a tax return each year, even if your CIS deductions exceed your tax liability

Note: CIS registration (as a subcontractor) and Self Assessment registration are separate. You need both. CIS registration determines your deduction rate (20% or 30%), while Self Assessment registration gives you a Unique Taxpayer Reference (UTR) and enables you to file an annual return.

Reporting Construction Income

On your Self Assessment return, construction income is reported on the self-employment pages:^[3]

Report your gross income (the amount before CIS deductions) as your business turnover
Deduct your allowable business expenses (tools, materials you bought, travel, etc.) to arrive at your taxable profit
Enter the total CIS deductions suffered in the dedicated box (SA103S box 21 or SA103F box 81)

Where to Enter CIS Deductions

Form	Box	Description
SA103S (short self-employment)	Box 21	“CIS deductions made from your income as a subcontractor”
SA103F (full self-employment)	Box 81	“CIS deductions made from your income as a subcontractor”

How Your Tax Is Calculated

HMRC calculates your total tax liability based on all your income (self-employment, employment, savings, etc.), then offsets the CIS deductions you have suffered:

Calculate total taxable income (construction profits + any other income)
Calculate Income Tax using the relevant tax bands
Calculate Class 2 and Class 4 National Insurance
Deduct CIS deductions suffered and any PAYE tax paid through employment
The result is either tax to pay (if deductions were less than the liability) or a refund (if deductions exceeded the liability)

Example: Your construction profits are £35,000. After personal allowance, your Income Tax liability is £4,486 and Class 4 NICs are £1,810 — total £6,296. You suffered £7,000 in CIS deductions during the year. HMRC will refund the £704 overpayment.

Payment and Deduction Statements

Contractors must provide you with a payment and deduction statement every time they make a CIS deduction. These statements show:^[2]

The contractor’s name and employer reference
Your name and UTR
The gross payment amount
The materials element (not subject to CIS deductions)
The CIS deduction amount and the rate applied
The net payment you received

Keep all payment and deduction statements for at least 6 years after the end of the tax year. You will need them to complete your Self Assessment return and to support your figures if HMRC queries them.

Key Deadlines

Deadline	Action Required
5 October (year after tax year starts)	Register for Self Assessment if newly self-employed
31 October	Paper tax return filing deadline
31 January	Online tax return filing deadline; payment of tax owed (or first payment on account)
31 July	Second payment on account

Tip: File your Self Assessment return as early as possible after 6 April. Early filing means you know sooner whether you are owed a refund, and HMRC tends to process early returns faster. You do not have to pay any tax owed until 31 January, even if you file in April.

Common Issues

Reporting net instead of gross: Always report your gross construction income as turnover, not the net amount after CIS deductions
Missing deduction statements: Contact contractors for duplicates; HMRC can also check their records
Forgetting to claim deductions: Ensure you enter the total CIS deductions in the correct box — otherwise you will overpay tax
Late registration: Register for Self Assessment promptly; late registration can lead to penalties

Frequently Asked Questions

Do I need to register for Self Assessment if I work under CIS?

Yes. If you are a self-employed subcontractor, you must register for Self Assessment with HMRC and file a tax return each year. This is separate from your CIS registration. You register for Self Assessment by 5 October following the tax year in which you started self-employment.

Where do I enter CIS deductions on my tax return?

CIS deductions are entered on the self-employment pages of your return. On form SA103S (short), use box 21. On form SA103F (full), use box 81. The box is labelled “CIS deductions made from your income as a subcontractor”. Enter the total deductions from all contractors for the tax year.

What income figure do I report — gross or net?

Report your gross construction income as your business turnover — this is the amount before CIS deductions are taken off. The CIS deductions are then claimed separately as a credit against your tax liability. Do not reduce your turnover by the CIS deductions.

What if I also have employment income?

If you have both employment income (taxed under PAYE) and self-employment income under CIS, you report both on your Self Assessment return. The employment income goes on the employment pages and the construction income on the self-employment pages. Your total tax liability is calculated on all income, and CIS deductions are offset against the total.

Sources

Self Assessment tax returns — GOV.UK
What you must do as a CIS subcontractor — GOV.UK
CIS: subcontractor’s obligations (CISR73000) — HMRC