Expert CIS Accountants for London Construction Contractors

The Construction Industry Scheme (CIS) is HMRC's tax deduction system for construction contractors and subcontractors. Under CIS, contractors deduct tax from subcontractor payments and send it to HMRC. Most subcontractors are taxed at 20% (or 30% if not registered), though you can apply for gross payment status (0% deduction) if eligible.

CIS applies to most construction work including site preparation, building, alterations, repairs, decorating, and demolition. It covers trades like builders, electricians, plumbers, carpenters, decorators, roofers, and scaffolders.

Full HMRC CIS Guide →

Yes, if you work in construction. CIS has complex rules around deductions, reverse charge VAT, materials vs labour, and gross payment status. A CIS specialist accountant ensures you're compliant, claiming all allowable expenses, and not overpaying tax.

Generic accountants often miss construction-specific deductions: tool depreciation, van expenses, site travel, protective clothing, trade insurance. LOYALS specializes in CIS – we've helped 500+ London contractors save thousands through proper expense claims and tax planning.

Additionally, CIS interacts with VAT (especially reverse charge), Self Assessment, Corporation Tax, and payroll in ways that non-specialists don't understand. Getting one thing wrong can trigger HMRC investigations.

LOYALS CIS accounting starts at £150/month including all CIS returns, tax returns, VAT, and compliance. This covers:

• Monthly CIS return submissions (if contractor)
• Self-Assessment tax return with CIS deductions
• VAT returns (monthly/quarterly) including reverse charge
• All HMRC correspondence
• Unlimited support 7 days/week
• Professional invoice management and debt recovery

Business Mentor package at £250/month adds monthly strategic guidance for growing contractors. Business Growth Programme at £2,000/month provides complete business team.

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Yes! If you're a subcontractor, CIS deductions are advance payments toward your annual tax bill. When filing your Self-Assessment, if deductions exceeded your actual tax liability, HMRC refunds the difference.

Many contractors don't claim all allowable expenses and overpay. Common missed deductions include: tools and equipment, van running costs, fuel and mileage, mobile phone, insurance, protective clothing, trade subscriptions, and training courses.

LOYALS reviews your last 3 years of returns (if applicable) to identify missed expenses and claim refunds. Our average CIS refund claim is £3,200. One client recovered £8,500 they didn't know they could claim.

Refunds typically arrive 4-8 weeks after filing. We can also claim back overpaid tax from previous years if your old accountant missed deductions.

It depends on your turnover and circumstances. Here's the general rule:

Stay self-employed if: You're earning under £30K-£50K annually. Self-employed is simpler, cheaper to run, and easier to manage. You pay Income Tax and National Insurance on profits.

Form a limited company if: You're earning over £50K annually. Limited companies pay 19-25% Corporation Tax (vs 20-45% Income Tax), and you can take salary + dividends for tax efficiency. Typical tax saving: 10-20% on earnings above £50K.

Example: A contractor earning £70K pays approximately £16,500 tax as self-employed, but only £11,800 via limited company (saving £4,700/year). The saving increases significantly at higher earnings.

LOYALS provides free consultations to calculate which structure saves you most. We handle the entire setup (UTR, Companies House registration, HMRC, CIS registration) in 7-10 days with zero hassle for you.

Gross payment status (GPS) lets you receive payments without 20% CIS deductions, dramatically improving cash flow. Instead of waiting months for tax refunds, you keep the money upfront.

Eligibility requirements:

• Turnover test: £30K+ (sole trader) or £30K+ per director (limited company) from construction in last 12 months
• Compliance test: Tax returns and payments on time for 12 months
• Business test: Demonstrate your construction business is genuine and established

Cash flow impact: A contractor invoicing £10K/month loses £2K to CIS deductions. With GPS, you keep the full £10K immediately – that's £24K extra working capital per year.

LOYALS handles GPS applications for eligible contractors. We assess eligibility, prepare the application, compile evidence, and liaise with HMRC. Success rate: 85% for eligible clients. Most approvals come within 6-8 weeks.

HMRC GPS Guide →

Since March 2021, most construction services between VAT-registered businesses use reverse charge VAT. This means:

• The supplier (subcontractor) doesn't charge VAT on their invoice
• The customer (contractor) accounts for VAT on their VAT return
• This prevents "missing trader fraud" in construction

What this means for you: Your invoices must state "Reverse charge: customer to pay the VAT to HMRC" and show VAT as £0.00. Your VAT returns must correctly account for reverse charge transactions in specific boxes.

Getting this wrong causes HMRC penalties. Many contractors were fined £2K-£5K in 2021-2022 for incorrect reverse charge handling. LOYALS ensures all your construction invoices comply with reverse charge rules and your VAT returns are correct.

Exceptions: Reverse charge doesn't apply to end-users (homeowners), materials-only supplies, or work outside construction services.

HMRC Reverse Charge Guide →

Yes, we handle all aspects of CIS registration:

For Subcontractors:

• CIS subcontractor registration with HMRC (reduces deduction from 30% to 20%)
• Obtaining UTR number for Self Assessment
• Ensuring contractors verify you before each payment
• Tracking CIS deductions for tax return refunds

For Contractors:

• CIS contractor registration with HMRC
• Setting up subcontractor verification systems
• Monthly CIS return submissions (CIS300)
• Payment of deducted tax to HMRC
• Maintaining compliant records

We handle all HMRC correspondence and ensure you're fully compliant from day one. No missed deadlines, no penalties, no stress.

HMRC requires you to keep construction records for 6 years minimum. Essential records include:

• All payments made to subcontractors and amounts deducted
• All payments received from contractors with CIS deduction certificates
• Invoices and receipts for materials, tools, equipment, van expenses
• Bank statements showing construction income and expenses
• Contracts and agreements with contractors/subcontractors
• Mileage logs for site travel
• Subcontractor verification confirmations

LOYALS sets up digital record-keeping systems (Xero or QuickBooks) so everything is tracked automatically. You simply:

• Upload receipts via mobile app (photo capture)
• Connect your bank account for automatic transaction import
• Log mileage in the app

We handle categorization, CIS tracking, and ensure everything is HMRC-compliant. If HMRC ever investigates, all your records are organized and ready.

Absolutely. We specialize in bringing contractors back into compliance.

If you've missed CIS submissions or tax returns, we'll:

• Assess what's outstanding (CIS returns, VAT, Self-Assessment, Corporation Tax)
• Gather all records and reconstruct missing information
• File all outstanding returns and bring you current
• Negotiate with HMRC to reduce penalties where possible
• Set up systems so you never fall behind again

Many clients come to us in exactly this situation – overwhelmed, facing penalties, worried about HMRC investigations. We've helped contractors with 2-3 years of unfiled returns get compliant within weeks.

HMRC penalties for late CIS returns: £100 per month late (can reach £3,000+). The sooner you act, the less you'll pay. LOYALS often negotiates penalties down to 30-50% of the original amount by demonstrating reasonable excuse and cooperation.

Contact us for a free consultation. We'll review your situation and provide a fixed-fee quote to get you compliant.