Do you need to file a CIS monthly return? The CIS deadline must be met, otherwise, you could face a range of penalties or fines. Filing your CIS return on time is key, and it’s important to understand when it needs to be completed. To learn more about the CIS deadline in the UK, continue reading.
Understanding CIS
CIS (Construction Industry Scheme) is a UK tax deduction scheme managed by HMRC for individuals, mainly contractors and subcontractors, working in the construction industry. The scheme allows contractors to deduct tax from subcontractors on their behalf.
By doing so, subcontractors can pay their taxes and National Insurance payments over a period, rather than all at once at the end of the tax year.
What Date Does CIS Have to be Submitted?
CIS must be submitted by the 19th of each month following the previous tax month. Contractors must inform HMRC about payments made to subcontractors. HMRC is quite specific with its deadlines, and it’s important to submit returns on time to avoid consequences.
What to Do if No Payments Have Been Made
If you have made no payments to subcontractors, you do not have to file a return for that month. However, HMRC won’t know that you’ve made no payments and may see it as you missing the deadline. Therefore, you should tell them no payments have been made so that they’re aware.
Is There a CIS Grace Period?
There is a CIS grace period of 90 days, but it’s unavailable to mainstream contractors. Instead, the grace period applies to deemed contractors (businesses that aren’t mainstream but subject to CIS due to making £3 million over 12 months).
The grace period allows newly deemed contractors enough time to set up the relevant systems to comply with CIS rules. If you require a grace period, you need to contact HMRC, as it doesn’t apply automatically.
How to File the CIS Monthly Return
Filing your monthly CIS return is simple and can be completed in a few steps:
- Gather all relevant information (subcontractor payments)
- Access HMRC and log in using the CIS online service
- Enter all subcontractor payments correctly
- Review the information you want to submit
- Submit your CIS return
Common CIS Monthly Return Mistakes
It’s common to make mistakes on your CIS monthly return, although it’s not great to do so. Mistakes happen, and in most cases, they can be easily resolved. Some common mistakes made on CIS returns include:
- Missing the deadline
- Miscalculating important payments
- Losing records of payments and deductions
If you make a mistake on your CIS return, you can often amend it by logging back into the CIS online service. However, it’s important to ensure all information is correct before submitting the first time. If you fail to mend a mistake, you could face issues with HMRC.
What Happens if You File a CIS Return Late?
If you fail to submit your monthly CIS return by the 19th of the month, you will likely be issued a fine. HMRC are strict regarding deadlines, so even being one day late could result in negative consequences.
Penalties
| Timeframe | Penalty |
|---|---|
| 1 day | £100 |
| 2 months | £200 |
| 6 months | £300 or 5% of the liability to make payments |
| 1 year | £300 or 5% of the liability to make payments (or a higher payment depending on why your return is late) |
You can learn more about the penalties for late CIS returns here.
Appealing Against CIS Late Penalties
If you disagree with the penalty issued by HMRC, you’ll have 30 days to appeal it. You can appeal your penalty by:
- Using the CIS online service
- Writing to HMRC (stating your Unique Taxpayer Reference and payment reference within your notice)
You should then wait to hear back from HMRC about the outcome of your appeal. If HMRC reject your appeal, you will have to pay the penalty. You can pay penalties online via the HMRC website.
Key Takeaways
- CIS is a UK tax deduction scheme managed by HMRC
- CIS must be submitted by the 19th of each month following the previous tax month
- Failure to submit your CIS monthly return results in penalties and fines
Do You Require Assistance With CIS Tax?
Do you require assistance with CIS tax? At LJS Accounting Services, we offer a range of expert services to help those working in the construction sector. With over a decade of experience, you can rely on us to ensure paperwork is handled correctly and that legislation regarding CIS is being followed accurately.
Everything we do is compliant with HMRC, and our team work hard to deliver excellent CIS-related services to benefit your business financially. Expect advice, guidance, and ongoing support when you choose us.
Contact our friendly and welcoming team today. We look forward to hearing from you in the near future.
Keli Evans, Director at LJS Accounting Services, excels in taxation and statutory accounts. With a focus on strong client relationships, she leads a diverse portfolio, overseeing vital financial aspects like VAT, payroll, pensions, and taxation with a holistic and committed approach.
