I work in the construction industry and want to be self-employed. How do I become registered under the new Construction Industry Scheme (CIS)?
It is FREE to apply for CIS status with HMRC. If you’re intending to work within construction you’ll want to register before you start doing so. If you don’t register, the deductions made from your payments will automatically be at the higher rate (30%).
You can register by calling the HMRC CIS Helpline on
Tel 0300 200 3210. You will be asked for your name, address, date of birth and your Unique Taxpayer Reference (UTR).
What tax deductions will be made from my pay?
When you provide Global Pay Solutions with your UTR number, we will contact HMRC to verify your CIS status for you. This will determine the rate of deduction made from your gross pay. As a rough guide, most subcontractor deductions are made at 20%.
In certain circumstances CIS subcontractors will be verified for 0% (gross) deductions. If you do not register before you start working or the HMRC cannot match your details under CIS, you will be deducted tax at the higher rate (30%).
Do I need to pay National Insurance (NI)?
Yes. If you are self-employed you must keep up with your Class 2 and Class 4 National Insurance contributions.
Can I claim expenses as self-employed?
Yes. You can claim your business expenses annually when you, or your accountant, complete your Self Assessment Tax Return. Remember, you must keep your expense receipts for up to six years in the event that HMRC wish to enquire into your tax return.
Will I receive holiday pay if I am self-employed?
When you are self-employed you take responsibility for your own holiday pay arrangements. Most agencies will agree a rate with you that includes holiday pay in accordance with the Working Time Directive legislation.
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