CIS Deduction Calculator
Calculate the correct CIS deduction to withhold from a subcontractor payment. Handles registered (20%) and unregistered (30%) rates, and correctly separates materials from the labour element before applying the deduction.
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How to use this cis calculator
Calculate Construction Industry Scheme deductions for subcontractor payments. Covers both the standard 20% and higher 30% deduction rates.
- 1Enter the gross payment
Type the total amount due to the subcontractor before deductions.
- 2Select the CIS rate
Choose 20% (registered) or 30% (unregistered) deduction rate.
- 3Check materials cost
Enter any materials cost, which is exempt from CIS deductions.
- 4View the breakdown
See the CIS deduction amount and the net payment to the subcontractor.
Why this matters
If you are a contractor in the construction industry, you are legally required to deduct CIS from subcontractor payments and report them to HMRC monthly. Getting deductions wrong can result in penalties and damage your relationship with subcontractors.
Frequently asked questions
What is CIS and who does it apply to?
The Construction Industry Scheme (CIS) is an HMRC scheme that requires contractors to deduct money from subcontractors' payments and pass it to HMRC. It applies to contractors who pay subcontractors for construction work in the UK. Both contractors (who deduct) and subcontractors (who receive reduced payment) need to register.
What is the CIS deduction rate?
The CIS deduction rate depends on the subcontractor's registration status: 20% for registered subcontractors who have been verified by HMRC; 30% for unregistered subcontractors; and 0% for subcontractors who have been granted gross payment status by HMRC. The deduction is calculated on the labour element only — not on the cost of materials.
Do CIS deductions apply to materials?
No. CIS deductions only apply to the labour element of a payment. If a subcontractor's invoice includes materials, you should deduct the cost of materials first and only apply the CIS rate to the remaining labour amount. Always ask your subcontractor to itemise materials separately on their invoice.
What do I do with the CIS deduction?
As the contractor, you must pay the deducted amount to HMRC each month as part of your CIS monthly return. You must give the subcontractor a payment and deduction statement showing the gross amount, the cost of materials, and the amount deducted.
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