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No. In 2026-27 a contractor paying you for construction work must apply CIS whether you register or not. Unregistered, 30% is taken instead of 20%. Only gross payment status stops the deductions.
The Construction Industry Scheme (CIS) is not something a subcontractor joins or leaves. The duty sits with the contractor: section 61 of the Finance Act 2004 says that on making a contract payment the contractor "must deduct", with a higher rate if you are not registered. Registering only changes the rate. This guide follows GOV.UK, HMRC's CIS 340 guide and HMRC's CIS manual, checked on 17 October 2026.
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Your options and what each one does
| What you do | What happens to your pay |
|---|---|
| Stay registered and give contractors the right details | 20% deducted from labour, claimed back through your tax return |
| Do not register, or your details do not match | 30% deducted from labour |
| Get gross payment status | No deductions; you pay all your tax after the year ends |
| Work only for private householders | CIS does not apply, because CIS 340 says ordinary householders having work done on their own homes are not contractors |
| Work as an employee | Outside CIS and taxed through PAYE, but CIS 340 says the terms of each engagement decide this, not your preference |
Say you invoice £20,000 of labour over a few months. Registered, £4,000 is deducted. Unregistered, £6,000 is. The extra £2,000 still counts towards your tax, but HMRC holds it until you file after the tax year ends. Not registering costs you cash flow, not tax.
Does CIS registration expire?
No. HMRC's manual says CIS registration for subcontractors "is only required once unless there is a change to the business structure", giving a sole trader forming a company as the example. There is no renewal date.
| Event | Effect on your registration |
|---|---|
| A year or more with no CIS work | Nothing; it stays in place |
| A contractor has not put you on a CIS return in the current or last 2 tax years | The contractor must verify you again; your registration is unchanged |
| You change trading name or address | Tell HMRC; no new registration |
| You become a partnership or company, or leave one to trade alone | Register again, because the registration cannot be transferred |
| You hold gross payment status | No expiry date, but HMRC reviews it every year |
GOV.UK says HMRC can withdraw gross payment status after the yearly review if you have not met the conditions, with 90 days' notice and 30 days to appeal, and that you must wait a year before reapplying. HMRC's manual also lists a request from the subcontractor among the reasons a tax treatment can change, so if you want to move from gross to net, ask the CIS helpline.
Changes you must report
GOV.UK lists what a subcontractor must tell HMRC:
- changing from sole trader to partnership, leaving a partnership or company to trade alone, or forming a company, which you report by calling the CIS helpline
- a change of trading name
- a change of business, private or registered office address
- stopping trading
- for a company with gross payment status, new shareholders, within 30 days
If you stop working in construction
The nearest thing to cancelling is telling HMRC you have stopped. GOV.UK says to use the online service to tell HMRC you have stopped self-employment, and that if you are registered for CIS you must call the CIS helpline as soon as possible.
HMRC's manual explains why there is no cancel button: the CIS system has no way to record that a subcontractor has stopped, so HMRC notes it on your Self Assessment record instead. If you held gross payment status, HMRC changes it to net with 90 days' notice. Any deductions taken this tax year are still yours to claim: our guide on what happens to your CIS deductions when you stop covers the early claim form and the final return.
If you were also a contractor and stop using subcontractors for good, GOV.UK says to tell HMRC and stop filing monthly returns. For a break of up to 6 months, an inactivity request does the job instead.
What this means for you
Apart from a few exceptions that depend on who is paying, such as work paid for by a charity, there is no way out of CIS for construction work a contractor pays you for. The real choice is between 20% and 30%, or nothing with gross payment status. For a sole trader that needs, among other tests, £30,000 of construction turnover in 12 months, ignoring VAT and materials, and returns and payments made on time. If cash flow is the problem, our guide on getting gross payment status sets out the tests. Before you join Making Tax Digital, over-deducted CIS is claimed back through your Self Assessment tax return. The sooner after 5 April you file, the sooner HMRC can repay you.
Steps to take before changing anything
- Check you are registered: your statements should show 20%, not 30%.
- If 30% is being taken, register or correct your details rather than trying to leave the scheme. Our guide on why your contractor deducted 30% explains the causes.
- If deductions hurt your cash flow, check whether you pass the gross payment status tests.
- If you change your name, address or business structure, tell HMRC.
- If you stop trading, tell HMRC you have stopped self-employment, call the CIS helpline and claim that year's deductions.
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Questions people ask
Can I deregister from CIS?
GOV.UK gives subcontractors no separate step to cancel a CIS registration. If you stop trading, you tell HMRC you have stopped self-employment and call the CIS helpline as soon as possible.
Does CIS registration expire?
No. HMRC's manual says a subcontractor only needs to register once, unless the business structure changes, for example when a sole trader forms a company.
What happens if I just do not register?
Contractors still have to deduct, but at 30% instead of 20%. The deductions still count towards your tax and National Insurance, and any overpayment comes back after you file your tax return.
Can I ask a contractor not to take CIS off?
No. The law requires the contractor to deduct at the rate HMRC gives it. Only gross payment status, which HMRC grants after checking your business, turnover and compliance record, lets a contractor pay you in full.
Do I need to register again if I change my trading name or address?
No, but GOV.UK says you must tell HMRC. A change of structure is different: becoming a partnership or a company means registering again, because the registration cannot be transferred.
Sources
- What you must do as a CIS subcontractor (GOV.UK)
- What you must do as a CIS subcontractor: Changes you need to report (GOV.UK)
- What you must do as a CIS subcontractor: Annual review (GOV.UK)
- Stop being self-employed (GOV.UK)
- Construction Industry Scheme: a guide for contractors and subcontractors (CIS 340) (GOV.UK)
- Finance Act 2004, section 61: Deductions on account of tax from contract payments (legislation.gov.uk)
- CISR42050: The registration process, sole trader applications (HMRC manual)
- CISR41070: Update subcontractor's details, cessation of trade (HMRC manual)
- CISR43030: Changing a subcontractor's tax treatment (HMRC manual)
This is general information to help you understand the rules. It isn't tailored to your circumstances, so check your own position before acting on it.
Righto Tax is a trading name of NJG Consultancy Ltd, registered in England and Wales, company number 16095900. Registered office: Jubilee House, East Beach, Lytham St Annes, FY8 5FT.
All CIS guides for subcontractors
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