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Yes, if you do construction work for a contractor. In October 2026 GOV.UK says you should register for CIS; if you do not, contractors must take 30% from your pay instead of 20%.
The Construction Industry Scheme (CIS) covers sole traders, partnerships and limited companies doing construction work in the UK for a contractor. Registering does not create a new tax. It sets the rate your contractors deduct in advance of your tax bill. Employees do not register: CIS is only for people working for themselves.
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Who should register
GOV.UK says you should register if you work for a contractor and you are a sole trader, the owner of a limited company, or a partner in a partnership or trust. That includes subcontractors based abroad who do construction work in the UK.
A contractor is any business that pays subcontractors for construction work, such as a builder, labour agency, gangmaster or property developer. Some businesses outside construction count too, once they spend more than £3 million on construction in 12 months. A private householder is never a contractor.
What counts as construction work
CIS 340 says the scheme covers most construction work in the UK, including:
- site preparation, demolition, excavation and foundations
- building, alterations, repairs, extensions and dismantling
- installing heating, lighting, power, plumbing, drainage, ventilation and fire protection systems
- painting and decorating, inside and out
- erecting and dismantling scaffolding
- fitting kitchens, bathrooms, glazing, doors and shop-fits
- roads, drives, landscaping and site restoration
What does not count
| Work | Inside CIS? |
|---|---|
| Architecture, surveying and pure consultancy | No |
| Hiring out scaffolding with no labour | No |
| Carpet fitting | No |
| Delivering materials, or making them off site | No |
| Burglar alarms, security CCTV and public address systems | No |
| Signwriting and advertising boards | No |
| Fitting blinds, louvred shutters and fixed seating | No |
| Running canteens, site security or site facilities | No |
| A contract mixing excluded and construction work | Yes, all of it |
The last row matters. CIS 340 says that when one contract includes any construction work, all payments under that contract fall within the scheme.
Registering compared with not registering
| Registered | Not registered | |
|---|---|---|
| Deduction rate | 20% | 30% |
| On £30,000 of labour in a year | £6,000 taken | £9,000 taken |
| Paid to you during the year | £24,000 | £21,000 |
The deductions in this table are worked out at the 2026-27 rates. Either way, the money counts towards your tax and National Insurance, and anything overpaid comes back after you file your tax return. Not registering does not cost you the extra £3,000 for good, but it ties it up with HMRC for months. Over-deducted CIS is claimed back through your tax return. The sooner after 5 April you file, the sooner HMRC can repay you.
What this means for you
If any of your customers are builders, developers or other contractors, register before your first job for them. If all your work is for homeowners, CIS does not apply to you. Your income is still taxed through Self Assessment, so you must register as self-employed either way.
If you already have a strong track record, with at least £30,000 of construction turnover in the last 12 months, you could apply for gross payment status instead. That registers you for CIS and means nothing is deducted.
Steps to decide and register
- List your customers. If any are contractors, CIS applies to the work you do for them.
- Check your work against the lists above. If you only do excluded work, such as carpet fitting, CIS does not apply.
- If you do not have a Unique Taxpayer Reference (UTR), register for Self Assessment as a new business and choose "working as a subcontractor". That registers you for both at once.
- If you have a UTR, register for CIS online with your legal name, UTR, National Insurance number and start date.
- Give each contractor the exact name and UTR you registered with, so they can verify you at 20%.
- Keep your monthly payment and deduction statements for your tax return.
Use the free MTD check to see when Making Tax Digital starts for you, and see the trades section for more on CIS.
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More for flooring fitters: what CIS covers, the costs you can claim and when Making Tax Digital starts.
Questions people ask
Is it illegal to work as a subcontractor without registering for CIS?
GOV.UK says you should register if you work for a contractor, but the consequence of not registering is that contractors must deduct 30% instead of 20%. You still need to register for Self Assessment as self-employed.
Do I need CIS if I only work for homeowners?
No. CIS 340 says private householders are not contractors, so payments straight from a homeowner are outside the scheme. If you also work for a builder who is doing a homeowner's job, the builder must apply CIS to you.
I am a limited company. Do I need to register?
GOV.UK says owners of limited companies that work for contractors should register the company. The company then sets deductions against the PAYE it owes each month.
Does CIS apply to scaffolding?
Erecting and dismantling scaffolding is construction work within CIS. Hiring out scaffolding with no labour is not.
Can I register for CIS if I am employed by the contractor?
No. CIS is for self-employed subcontractors and businesses. GOV.UK says employees do not register, and contractors must check whether someone should be employed instead.
Sources
- What you must do as a CIS subcontractor (GOV.UK)
- What you must do as a CIS contractor: Who is covered by CIS (GOV.UK)
- Construction Industry Scheme: a guide for contractors and subcontractors, CIS 340, sections 1.2, 2.19 to 2.21 and Appendix C (GOV.UK)
- What you must do as a CIS subcontractor: How to register (GOV.UK)
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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