What you must do as a Construction Industry Scheme (CIS) subcontractor
How to get gross payment status
Having gross payment status means contractors will pay you in full, without deductions. You’ll pay all your tax and National Insurance at the end of the tax year.
To qualify
You must show HM Revenue and Customs (HMRC) that your business passes some tests. You’ll need to show that:
- you’ve paid your tax and National Insurance on time in the past
- your business does construction work (or provides labour for it) in the UK
- your business is run through a bank account
HMRC will look at your turnover for the last 12 months. Ignoring VAT and the cost of materials, your turnover must be at least:
- £30,000 if you’re a sole trader
- £30,000 for each partner in a partnership, or at least £100,000 for the whole partnership
- £30,000 for each director of a company, or at least £100,000 for the whole company
If your company’s controlled by 5 people or fewer, you must have an annual turnover of £30,000 for each of them.
You could be fined if you provide false information and so could anyone who helps you to make a false registration.
Apply online or by post
You can apply for gross payment status by filling in an online or postal form. This will also register you for the Construction Industry Scheme (CIS) if you’ve not already registered.
The form you fill in depends on whether you’re a:
Paying tax when you have gross payment status
You must declare your payments as income at the end of the tax year in:
- your Self Assessment tax return if you’re a sole trader or partner
- your Corporation Tax return if you own a limited company