CIS Payment and Deduction Statement: What It Shows and How to Track Yours
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If you work under the Construction Industry Scheme (CIS), the payment and deduction statement is the most important piece of paper you get from a contractor. It is your proof of the tax already taken from your pay, and you need it to claim that money back. This guide explains what a CIS statement is, what it should show, when you should get it and how to keep track of yours. Everything here is checked against HMRC guidance on GOV.UK.
What is a CIS payment and deduction statement?
When a contractor pays a subcontractor under CIS, they usually take a deduction from the payment and pass it to HMRC. The deduction counts as an advance payment towards the subcontractor's tax and National Insurance. If the contractor makes a deduction, they must give the subcontractor a payment and deduction statement within 14 days of the end of each tax month.
Tax months run from the 6th of one month to the 5th of the next. For example, for the tax month 6 May to 5 June, the statement must be given by 19 June.
What a CIS statement shows
HMRC's CIS guide for contractors and subcontractors (CIS340) includes an example statement. It shows:
- the contractor's name, address and employer reference number
- the tax month the statement covers (for example, "month ending 5 April")
- the subcontractor's name and Unique Taxpayer Reference (UTR)
- the gross amount paid, excluding VAT
- the cost of materials taken off
- the amount liable to deduction
- the amount deducted
- the amount payable to the subcontractor
- a verification number, but only where a deduction was made at the higher rate
A worked example
HMRC's own example uses these figures:
- Gross amount paid (excluding VAT): £5,450.36
- Less cost of materials: £584.72
- Amount liable to deduction at 20%: £4,865.64
- Amount deducted: £973.12
- Amount payable: £4,477.24
The deduction is worked out on the labour part of the invoice, after taking away things like VAT and materials the subcontractor paid for directly.
CIS deduction rates
- 20% for registered subcontractors
- 30% for subcontractors who are not registered
- 0% for subcontractors with gross payment status
Contractors don't have to give a statement when they pay you gross, although HMRC says it is good practice to do so.
If a statement goes missing
If a statement doesn't reach you or gets lost, you can ask the contractor for another copy. The duplicate must be clearly marked "Duplicate".
Why your statements matter at tax return time
If you are a sole trader, you report your CIS income and deductions on the self-employment pages of your Self Assessment tax return. The deductions are taken off your tax bill, and if more has been deducted than you owe, HMRC repays the difference. Your statements are the evidence for the figures you enter, so keep every one.
A simple way to keep track
A CIS statement "template" for subcontractors is really a checklist: each month, check you have a statement from every contractor who paid you, and that the numbers match your invoices. Many tradespeople keep a running record with columns for:
- tax month and contractor
- invoice number and gross amount (excluding VAT)
- materials
- amount deducted and amount received
- statement received (yes / no)
Adding the deductions up through the tax year (6 April to 5 April) gives you the total CIS deducted figure you need for your return, and shows straight away if a statement is missing.
Our Self-Employed Record Book 2027/28 (£1.47) has monthly money in and out logs, invoice pages and a tax pot planner you can use alongside your CIS statements. For a deeper look at how CIS works, read our CIS deductions guide for subcontractors.
Sources: GOV.UK, "What you must do as a CIS contractor" and "Construction Industry Scheme: a guide for contractors and subcontractors (CIS340)". This is general information, not tax advice.