CIS returns
A CIS return is the monthly report a contractor files with HMRC, listing every subcontractor paid that month and the tax deducted from them. It is due by the 19th, it must be filed even when nobody was paid, and it is £100 the moment it is late.
Updated 10 September 2026 · Tax year 2026/27
Who files a CIS return? #
Contractors file. Subcontractors do not. If you pay other people for construction work you file a CIS return every month. If you are only ever the one being paid, you never file one, and your CIS deductions are reported once a year on your Self Assessment return instead.
Many people are both. A subcontractor who takes on their own labour becomes a contractor for that purpose and has to file. CIS registration covers both sides.
When is the CIS return deadline? #
The 19th of each month. The return covers the tax month that ended on the 5th, not the calendar month.
| Tax month | Return due | Payment due if paying electronically |
|---|---|---|
| 6 April to 5 May | 19 May | 22 May |
| 6 May to 5 June | 19 June | 22 June |
| 6 June to 5 July | 19 July | 22 July |
Filing and paying are two separate obligations with two separate deadlines. Filing on time does not excuse paying late, and paying on time does not excuse filing late.
What goes on a CIS return? #
For every subcontractor you paid in the month:
- Their name and Unique Taxpayer Reference
- The verification number, where the 30% rate was applied
- The gross amount paid, excluding VAT
- The cost of materials excluded from the deduction
- The amount of CIS deducted
The materials figure matters here as much as it does on the invoice. CIS is deducted from labour only, and the return records the split. What counts as materials under CIS.
You also have to declare that every subcontractor listed has been considered for employment status. That declaration is not a formality. Treating someone as a subcontractor when they are really an employee is a separate and more expensive problem.
Do I need to file a nil CIS return? #
Yes. If you paid no subcontractors in a tax month, you still file, and it is called a nil return. Missing one costs the same £100 as missing a return with payments on it.
The exception is if you tell HMRC in advance that no returns are due for a period, for example because work has stopped. That has to be done deliberately. Simply not filing is not the same thing, and the penalties accumulate quietly while you assume nothing is owed.
What is the penalty for a late CIS return? #
£100 the moment the deadline passes, then escalating at two, six and twelve months. These figures come from HMRC's compliance checks factsheet on penalties for failing to file monthly CIS returns, and apply to returns with a filing date of 19 November 2011 or later.
| How late | Penalty |
|---|---|
| 1 day | Initial fixed penalty of £100 |
| 2 months | Second fixed penalty of £200 |
| 6 months | Further penalty of £300, or 5% of the liability to make payments, whichever is greater |
| 12 months | Second further penalty of £300 or 5%, rising to a higher penalty where information was deliberately withheld |
"Liability to make payments" means the CIS deductions the contractor should have taken from subcontractors and shown on that return. HMRC normally charges the flat £300 automatically at six and twelve months, then tops it up if 5% turns out to be more once the return arrives. In practice 5% only exceeds £300 where the return shows more than £6,000 of deductions.
The £3,000 cap for first-time filers #
This is the part almost nobody mentions, and it matters if you have never filed at all.
When a contractor files their first ever CIS return and earlier returns are also outstanding, HMRC caps the total of the £100 and £200 fixed penalties at £3,000 across that first return and the earlier ones. The cap does not extend to any later periods.
A separate rule follows from it: where penalties have been capped, HMRC will normally charge 5% of the liability at six and twelve months even where that comes to less than £300.
Returns covering only gross payment subcontractors #
If every subcontractor on the return holds gross payment status, no deductions were made, so there is no liability for a percentage to be applied to. HMRC charges a flat £300 at six months, and at twelve months £300, £1,500 or £3,000 depending on why the return was late.
The twelve-month higher penalty #
At twelve months HMRC considers whether information was withheld deliberately. If it was, the penalty stops being a fixed sum and becomes a percentage of the liability, with a floor.
| Behaviour | Told HMRC first | HMRC found it | Minimum |
|---|---|---|---|
| Deliberate | 20% to 70% | 35% to 70% | £1,500 |
| Deliberate and concealed | 30% to 100% | 50% to 100% | £3,000 |
Deliberate means you knew that not filing withheld information from HMRC. Deliberate and concealed means you also took steps to hide it. Anything else is non-deliberate, and on a return with no liability that means no increase beyond the £300.
Telling HMRC before they find out is worth real money. It moves a deliberate case from a 35% floor to a 20% floor, and a concealed case from 50% to 30%.
Reducing a higher penalty #
Where a higher penalty applies, HMRC reduces it according to how much help you give, which it calls the quality of disclosure:
- Telling HMRC about the withheld information: up to 30%
- Helping them work out the liability: up to 40%
- Giving access to your records: up to 30%
Delay costs you. Where it has taken three years or more to come forward, HMRC usually caps the reduction at ten percentage points above the bottom of the range, so the lowest rate stops being available.
How to file #
- Verify any new subcontractor with HMRC before their first payment, and record the rate returned
- Record each payment, splitting labour from materials
- File the return through HMRC's online service or your accounting software by the 19th
- Pay the deductions to HMRC by the 22nd if paying electronically
- Issue each subcontractor a payment and deduction statement within 14 days of the tax month end
Most accounting software with a CIS module files the return directly, which removes the re-keying and the arithmetic errors that come with it.
Reasonable excuse #
HMRC will not charge a late filing penalty where you had a reasonable excuse, provided you filed without unreasonable delay once the excuse ended.
HMRC describes a reasonable excuse as something that stopped you meeting an obligation you took reasonable care to meet, and says explicitly that it depends on your own circumstances and abilities. What counts for one person may not count for another, which is more flexible than it is usually presented.
Two things HMRC says it cannot normally accept:
- Lack of funds to pay, unless the shortage was itself outside your control
- Relying on someone else to file for you, unless you took reasonable care to avoid the failure
Health and personal circumstances that made filing difficult should be raised directly with the officer handling the case, because HMRC is required to take them into account.
If returns have gone unfiled, get them filed before appealing. Penalties continue to accrue while the returns are outstanding.
What is a CIS return? #
A CIS return is the monthly declaration a contractor files telling HMRC who they paid under the Construction Industry Scheme, how much, and how much they deducted. It is filed by the contractor, not the subcontractor, and it is due by the 19th of each month.
Subcontractors never file one. What a subcontractor does is collect the payment and deduction statements the contractor must issue, and use those to reclaim the over-deduction through Self Assessment at the end of the year.
Common questions #
What is a CIS return?
A CIS return is the monthly report a contractor files with HMRC listing every subcontractor paid in that tax month, the amounts paid, the cost of materials excluded, and the CIS deducted. It is filed by the contractor, never by the subcontractor.
When is the CIS return deadline?
The 19th of each month, covering the tax month that ended on the 5th. So the month running from 6 April to 5 May must be filed by 19 May.
Do I need to file a nil CIS return?
Yes, unless you have told HMRC that no return is due. If you paid no subcontractors in a month you must still file a nil return, and the penalty for missing one is the same as for missing a return with payments on it.
What is the penalty for a late CIS return?
An automatic £100 as soon as the deadline passes, a further £200 at two months, and at six and twelve months £300 or 5% of the CIS deductions that should have been on the return, whichever is greater. At twelve months the penalty can rise to as much as 100% of the deductions where HMRC finds information was deliberately withheld.
Are CIS penalties capped?
Yes, in one situation. When a contractor files their first ever CIS return and earlier returns are also outstanding, HMRC caps the total of the £100 and £200 fixed penalties at £3,000 across that first return and the earlier ones. The cap does not apply to later periods, and it does not apply if you have filed before and then stopped.
Do subcontractors file a CIS return?
No. Subcontractors do not file CIS returns. They report their CIS income and deductions on their Self Assessment tax return once a year, which is also how any refund is claimed.
Working out the deduction to put on the return? Use the CIS calculator.