CIS tax calculator

Work out your CIS deduction and what the contractor pays you. Costs you paid for come off first, then 20%, 30% or 0% is taken from the rest, with or without VAT.

What do you want to work out?

Your CIS status

HMRC tells your contractor which rate to use when they verify you.

VAT

No VAT on your invoice. VAT never changes the CIS deduction.

The job

Invoice amount for the work, before VAT

Everything you charge for the job, including materials.

Costs you paid for (no CIS on these)

Enter what you paid, including VAT, as you’re not VAT registered. Leave blank if none.

Materials

Bought by you for this job

Manufacturing or prefabricating materials

What you paid to have them made

Plant or equipment hired for the job

Hired from someone else, not your own

Consumable stores

Items used up on the job

Fuel used for the work

Including fuel for plant. Not travel

Contractor pays you

£840.00

After a CIS deduction of £160.00.

Invoice before VAT: £1,000.00
Costs taken off first: £200.00
Deduction worked out on (labour): £800.00
CIS deduction at 20%: £160.00
VAT on the invoice: None
Contractor pays you: £840.00

The £160.00 deduction isn’t lost. It counts as an advance payment towards your tax and National Insurance bill.

Estimate only, not tax advice. Based on HMRC guidance checked in October 2026. Your contractor’s payment and deduction statement shows the actual figures, and money is rounded down to the penny.

How the CIS deduction is worked out

Under the Construction Industry Scheme (CIS), a contractor takes money from your payments and passes it to HMRC. It isn’t an extra tax. It’s an advance payment towards your own tax and National Insurance bill.

Start with your invoice for the job, before VAT.
Take off what you paid for materials, manufacturing or prefabricating materials, plant hired for the job, consumable stores and fuel used for the work (not travel).
Take 20% of what’s left if you’re registered, 30% if you’re not or can’t be verified, or nothing with gross payment status.
The contractor pays you the invoice, plus any VAT, minus the deduction.

Only what you paid for this job counts: without VAT if you’re VAT registered, with VAT if you’re not. Your contractor can ask for receipts, and will estimate the cost of materials if you can’t show them. If they take off a CITB levy or another charge, the deduction is worked out on the payment after it. The calculator leaves those charges out.

Working backwards from what you want to be paid

Choose “From what I want paid”, then enter what you want after CIS (before VAT) and your costs. The invoice is (amount wanted − rate × costs) ÷ (1 − rate). To be paid £1,000 with £200 of materials at 20%, that’s (£1,000 − £40) ÷ 0.8 = £1,200.

VAT and the reverse charge

VAT goes on top of your invoice but never changes the deduction. Most CIS work between VAT-registered businesses uses the domestic reverse charge: no VAT on your invoice, a note such as “Customer to pay the VAT to HMRC”, and the contractor accounts for the VAT. It doesn’t apply if your customer has told you in writing that they’re an end user.

Rounding

HMRC sets no rounding rule for the deduction, so we drop fractions of a penny, as HMRC’s CIS 340 example does. VAT is rounded down to the penny, which VAT Notice 700 allows. Your contractor’s figure may differ by a penny.

Worked example

A plasterer registered for CIS and VAT invoices a contractor £2,400 before VAT. They paid £450 for materials, £120 to hire a mixer and £30 for consumables, all before VAT. The reverse charge applies.

Invoice before VAT: £2,400.00
Costs taken off: £450 + £120 + £30 = £600.00
Deduction worked out on: £2,400 − £600 = £1,800.00
CIS deduction at 20%: £360.00
VAT on the invoice: none. The contractor accounts for £480.00 under the reverse charge.
Contractor pays the plasterer: £2,400 − £360 = £2,040.00

The plasterer then claims the £360 on their Self Assessment return. If they weren’t registered for CIS, the deduction would be 30%, or £540.

CIS rates and what they apply to

CIS deduction rates
Your status	Deduction	When it applies
Registered (net payment status)	20%	You’re registered and the contractor can verify you
Not registered	30%	You’re not registered, or can’t be verified
Gross payment status	0%	Nothing taken off. You pay your own tax

What the deduction is worked out on
On your invoice	Taxed under CIS?	Notes
Labour and profit	Yes	Including any mark-up on materials
Materials you paid for	No	Without VAT if you’re VAT registered, with VAT if not
Manufacturing or prefabricating materials	No	What you paid
Plant or equipment hired for the job	No	Hired from someone else. No hire charge on plant you own
Consumable stores	No	Equipment used up on the job
Fuel used for the work	No	Including fuel for plant. Not fuel for travelling
Travel, subsistence and accommodation	Yes	When the contractor pays them under the contract
VAT	No	Never part of the CIS sum

Only costs you paid directly for this job count.

FAQ

Questions about CIS deductions

How do you work out a CIS tax deduction?

Take your invoice before VAT, subtract the materials, plant hire, consumables and fuel you paid for, then take 20% of the rest (30% if you’re not registered, nothing with gross payment status). A £1,000 invoice with £200 of materials gives a £160 deduction, so you’re paid £840.

Is CIS tax always 20%?

No. 20% is for registered subcontractors the contractor can verify. It’s 30% if you’re not registered or can’t be verified, and nothing with gross payment status. HMRC tells the contractor which rate to use.

How much tax do you pay on CIS?

The deduction is an advance, not your final bill. Sole traders and partners enter their pay before deductions, and the CIS deductions, on their Self Assessment return. HMRC works out what you owe and takes off what’s been deducted. HMRC repays any overpayment, or you pay the rest by 31 January. Limited companies use the deductions against what they owe through payroll.

How do I check my CIS deduction?

Your contractor must give you a payment and deduction statement within 14 days of the end of each tax month, so by the 19th. It shows the gross amount, materials and deduction, so you can check them here. If the figures look wrong, speak to your contractor.

What are the new CIS rules for 2026?

The rates are still 20%, 30% and 0%, and the deduction is worked out the same way. Two changes took effect on 6 April 2026: payments to local authorities and public bodies are now outside CIS, and contractors who pay no subcontractors in a month must file a nil return again, unless they’ve told HMRC in advance they’ll be inactive.