Tax, CIS and Making Tax Digital for self-employed plant operators

When Making Tax Digital starts for plant operators

It depends on your qualifying income, not your trade. Qualifying income is the total of self-employment and property income before expenses (turnover), not profit.

Once you’re in, you send HMRC a quarterly update by 7 August, 7 November, 7 February and 7 May, then a tax return after the year ends. MTD for Income Tax does not change how tax is paid or the payment due dates.

Check your own start date and what to sort first. It’s free and takes a minute.

CIS for plant operators

HMRC treats using plant as an integral part of construction, so a payment for a machine hired with an operator is covered, and so is supplying your own labour to drive a contractor’s machine. Hiring a machine out with no operator is outside CIS, and so are delivering, repairing or servicing plant on their own. Moving materials around a site is covered, but carting spoil off site, or materials between sites on public roads, is not. On your invoice, fuel the machine uses on the job comes off as materials, and so does plant you hired from another firm, but there is no allowance for a machine you own or are buying on hire purchase. Digging in quarries and open-cast mines is outside CIS altogether.

When CIS applies, a contractor deducts 20% if you’re registered for CIS, 30% if you’re not, and nothing if you have gross payment status. To work out a CIS deduction, the contractor starts with the gross invoice and takes away what the subcontractor paid for VAT, consumable stores, fuel (except for travelling), plant hire, manufacturing or prefabricating materials, and materials; the CIS rate is then deducted from the amount left.

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.

Estimate your CIS refund

Free, and it runs in your browser: add your van or mileage, tools and phone, for 2025-26 and 2026-27.

Costs plant operators usually claim

The test for every cost is whether it was for your business. If something is partly personal, only the business part counts.

Your van, tools and kit

The machine is usually the biggest thing the business owns, so the first question is whether it is bought, on hire purchase or hired in. A machine you buy is equipment: under the cash basis it is claimed as an expense, and under traditional accounting through capital allowances. On hire purchase, the interest is a finance cost of its own. Moving the machine is part of the job: a plant trailer is business equipment, and a double cab pickup bought from 6 April 2025 is now usually treated as a car, not a van. The flat mileage rates are for cars, vans and motorcycles, so fuel for the machine is claimed as its own cost. Operators often follow one machine to one site for weeks, so keep a log of where you worked, because daily travel to a fixed place of work is commuting.

From 2024-25 the cash basis is the default for sole traders and partnerships without corporate partners, with no turnover limit; traditional (accruals) accounting is an opt-out. Under the cash basis, the cost of equipment bought to keep and use in the business, such as machinery, computers and vans, is claimed as a normal allowable expense rather than a capital allowance. Cars are different: they go through capital allowances.

Simplified expenses for cars and goods vehicles (vans) from 6 April 2026: 55p a mile for the first 10,000 business miles, then 25p; motorcycles 24p. Once used for a vehicle you must keep using it for that vehicle, and it cannot be used for a vehicle already claimed through capital allowances.