The new tax year has just started, which means if you work in construction as a subcontractor under the Construction Industry Scheme (CIS), now is the perfect time to get your information together and claim back any tax you’re owed.

Many subcontractors are due a refund every year and don’t even realise it. If that’s you, there’s no reason to wait.

How CIS deductions work

Under the Construction Industry Scheme, contractors are required to deduct money from the payments they make to subcontractors and pass it directly to HMRC. Think of it a bit like PAYE – the tax comes out before you see the money.

The deduction rate depends on your registration status:

  • Registered subcontractors have 20% deducted
  • Unregistered subcontractors have 30% deducted
  • Gross payment status means no deductions are made, though this requires a separate application and isn’t available to everyone

For most subcontractors, this means money is being held by HMRC throughout the year. And once the tax year ends on 5 April, you can claim back whatever you’ve overpaid.

Why are so many subcontractors owed a refund?

The deductions made under CIS are based on your gross income – they don’t take into account your expenses, your personal tax allowance, or any other reliefs you’re entitled to.

So once we factor all of that in through your Self Assessment tax return, the amount you actually owe HMRC is often significantly less than what’s already been deducted. The difference comes back to you as a refund.

For many subcontractors, especially those with legitimate business expenses such as tools, fuel, workwear, or use of a vehicle, the refund can be a meaningful sum.

What do you need to send us?

The sooner you get your information to us, the sooner we can file your return and get your refund processed. 

Here’s what we’ll typically need:

  • Your CIS deduction statements (these should be provided by each contractor you’ve worked for during the year)
  • Details of any expenses you’ve incurred in the course of your work
  • Any other income you’ve received during the tax year
  • Bank account details so your refund can be paid to you

If you’re not sure what you have or whether something counts as an allowable expense, just get in touch. We’d much rather talk it through with you than have you sit on a refund because you weren’t sure what to do.

Don’t leave it sitting with HMRC

We know that for a lot of self-employed people in construction, chasing paperwork isn’t top of the priority list when there’s work to be getting on with. But your CIS refund is your money, and there’s no reason for it to sit with HMRC any longer than it needs to.

The Self Assessment deadline isn’t until January 2027, but filing early means you get your refund early. There’s no queue-jumping required – it’s simply first-come, first-served.

We’re here to make it straightforward

At Smethurst & Co, we’ve been helping tradespeople and construction businesses across the region manage their tax affairs for decades. We understand the CIS system inside out, and we make the process as simple as possible for you.

You don’t need to come in with a perfectly organised folder of receipts. Get what you have together, give us a call, and we’ll take it from there.

Ready to get started? Contact us today, and let’s get your refund moving.