Does CIS apply to plant hire?

It depends on the operator. As of October 2026, HMRC's manual says plant hired with an operator is subject to the Construction Industry Scheme (CIS), and plant hired without one is outside it.

Plant here means kit such as scaffolding, cranes, cement mixers, concrete pumps, earth-moving equipment and compressors. The rule matters twice over: once for the business hiring the plant out, and again for the subcontractor who hires it in to do a job.

The rule from HMRC's manual

The Finance Act 2004 brings into CIS work that forms an integral part of, or is preparatory to, construction operations. HMRC's manual (CISR14260) says using plant is an integral part of any substantial construction project, then sets two rules:

The table follows CISR14260, CIS 340 Appendix C and HMRC's VAT reverse charge technical guide, checked on 16 October 2026.

If you hire out plant with an operator

You are a subcontractor for that work. GOV.UK says contractors deduct 20% if you are registered for CIS and can be verified, 30% if not, and nothing if you hold gross payment status. A plant firm that does not register will have 30% taken from every operated hire.

Your own machine gets no allowance. CIS 340 says no notional deduction is made for plant the subcontractor owns, but fuel the plant uses can be treated as materials.

Example. You own a 13-tonne excavator and hire it with yourself as driver for 5 days at £400 a day, plus £300 of diesel used on site. You are registered and not VAT registered.

The right-hand column shows that plant you hire in from someone else counts as materials, while your own machine does not.

If you hire plant in to do your own work

Say you are a groundworker on a CIS contract and you dry-hire a dumper for the week. The hire firm is paid in full, because dry hire is outside CIS. On your own invoice to the main contractor, CISR15090 says the cost of the hire, and fuel needed to run it, may be treated as materials, so it comes off before your deduction is worked out.

Hire purchase does not count. HMRC's manual says some subcontractors argue that plant bought on hire purchase for a job should be treated as hired, and rejects it.

VAT on plant hire

Plant hire has its own VAT angle. HMRC's technical guide says hiring goods on their own is outside CIS, so the VAT domestic reverse charge does not apply to the hire charge. The guide also says a separate order for the hire of plant is not subject to CIS. Take care with mixed contracts, though: CIS 340 says that if one contract includes some construction work, all payments under it come within CIS, even on separate invoices. The same guide says operated plant or machinery used on new build housing developments is zero-rated and not subject to the reverse charge.

What this means for you

For a plant firm, the question is whether the hire includes an operator. If it does, expect CIS on the payment and make sure you are registered, so the rate is 20% and not 30%. Show diesel used on the job on its own line, because it can come off before the deduction.

For a subcontractor hiring kit in, keep every hire invoice. The contractor can ask for evidence, and without it the contractor may estimate. The deduction is an advance payment towards your tax. Before you join Making Tax Digital, over-deducted CIS is claimed back through your Self Assessment tax return. Once you are in Making Tax Digital, HMRC adds your CIS deductions to your tax return, and any refund is requested separately through HMRC online services. Either way, the sooner after 5 April the return is filed, the sooner HMRC can repay you.

Steps to check plant hire under CIS

1. Decide whether each hire is with an operator (within CIS) or without (outside it).
2. If you supply an operator, register for CIS and give contractors your exact registered name and UTR.
3. Put fuel used on the job, and any plant you hired in, on separate invoice lines.
4. Do not list plant you own, or are buying on hire purchase, as materials.
5. Check each payment and deduction statement shows the hired plant and fuel in the materials figure.

For which other jobs are covered, see what work is covered by CIS. Use the free MTD check to see when Making Tax Digital starts for you, and the trades section for more on CIS.