CIS with Payroll – A Complete Guide for Your Business

At Maak Accountancy, we understand how complex managing your business’s financial operations can be, especially when it comes to construction industry services (CIS) and payroll. If your business is involved in construction, understanding CIS (Construction Industry Scheme) is essential, as it directly impacts how you manage payments and taxes for subcontractors.

What is CIS?

The Construction Industry Scheme (CIS) is a tax deduction scheme for subcontractors in the construction industry. It’s designed to ensure that the correct tax is paid on payments made to subcontractors for construction work. Under the CIS, contractors are required to deduct tax at source from payments made to subcontractors for work carried out on construction sites.

For contractors, CIS provides a way to ensure they fulfill their tax obligations when hiring subcontractors. As a subcontractor, you must be registered under CIS to ensure your tax is deducted correctly and at the appropriate rate.

CIS and Payroll: What’s the Connection?

CIS and payroll go hand in hand, especially for construction businesses. As a contractor, you’re responsible for ensuring that subcontractors are registered under the CIS. Depending on their registration status, the tax deduction rate may vary, and this deduction will need to be reported as part of the payroll.

In practice, this means you must:

  • Register with HMRC under CIS if you’re a contractor or a subcontractor.
  • Verify subcontractors’ status with HMRC to determine the correct tax deduction rate.
  • Deduct CIS tax from subcontractor payments and ensure this is reflected in your payroll system.
  • Report deductions to HMRC monthly, ensuring you remain compliant with tax laws.

This is where Maak Accountancy comes in. Our services ensure that your business remains compliant with all CIS regulations while also integrating payroll effectively. We help streamline this process, reducing the risk of errors and penalties while ensuring that your employees and subcontractors are paid on time.

Why You Need Professional Help for CIS and Payroll

Managing CIS alongside payroll requires an understanding of tax regulations, accurate reporting, and timely deductions. Failing to comply with CIS and payroll regulations can lead to costly penalties and interest. By working with a professional accountancy firm like Maak Accountancy, you can:

  • Avoid penalties: We ensure that all payments and tax deductions are made correctly, avoiding penalties from HMRC.
  • Save time: Handling CIS deductions and payroll manually can be time-consuming. Our services ensure that your business runs smoothly without the administrative burden.
  • Stay compliant: We keep up to date with changes in CIS and payroll legislation, ensuring your business always complies with the latest rules.

How Maak Accountancy Can Help

Our team specializes in providing expert support for businesses operating under CIS, including:

  • CIS registration and verification: We can help you register your business and subcontractors with HMRC, ensuring you’re set up for CIS compliance.
  • CIS tax deductions: We assist in making accurate tax deductions from subcontractors and reporting them correctly to HMRC.
  • Payroll integration: Our payroll services ensure that your employees and subcontractors are paid on time while keeping track of all necessary deductions.
  • CIS returns and reporting: We handle the monthly reporting requirements and submit all necessary documentation to HMRC, allowing you to focus on growing your business.

Useful UK Government Links

For more information on CIS and payroll requirements, you can visit the following UK government websites:

By partnering with Maak Accountancy, you ensure that your business remains compliant with CIS and payroll obligations, allowing you to focus on the success of your construction business. For more details or to schedule a consultation, contact us today!