If you're new to self-employment in construction, there’s a good chance no one’s told you about CIS cards. That’s a problem. Because without one, you could be getting hit with bigger tax deductions than you need to be.

If you’re registered for CIS, you’ll get a CIS card to prove it. That card shows contractors you’re set up properly and helps make sure you’re paid the right amount.

If you’re not registered, your contractor has to take 30% off your pay. If you are registered, that drops to 20%. That 10% difference could put hundreds back in your pocket each month.

Understanding your CIS Card

CIS stands for the Construction Industry Scheme. It’s a tax scheme run by HMRC for self-employed people working in construction. If you're a subcontractor, it means tax gets taken off your payments before they even reach you.

Your CIS card is proof that you're registered under the scheme. It shows contractors that they can deduct the lower 20% tax rate from your earnings, instead of the higher 30% they’re required to take if you’re not registered.

The CIS system was brought in to tackle tax avoidance in the construction industry. By taking tax at source, HMRC makes sure people don’t fall behind on what they owe. But here’s the thing – if you don’t register, you end up overpaying, and that money can take time to claim back.

Getting your CIS card is one of the first steps in setting yourself up properly as a self-employed construction worker. Without it, you could be losing out every time you get paid.

CIS tax deduction rates explained

One of the biggest reasons to get your CIS registration sorted is how it affects your take-home pay. The CIS sets fixed tax deduction rates depending on your status. Here’s how it works.

If you're not registered for CIS (30% deduction)

When you’re not registered, HMRC tells your contractor to deduct 30% of your payments for tax. This is taken from your labour costs, not your materials – but it still hits hard. For example, if you earn £1,000 for a job, you’ll only get £700. That’s £300 gone before it even reaches your bank account.

This higher CIS tax deduction is meant to make sure tax still gets collected, but it leaves you with less cash to cover your work expenses or manage your bills.

If you are registered for CIS (20% deduction)

Once you’ve completed your CIS registration, your deduction rate drops to 20%. That means you keep more of your earnings from the start. On a £1,000 job, you’d keep £800 instead of £700. That’s an instant pay rise of 10% just for getting registered.

Think about it weekly: if you’re making £600 a week, the difference between a 30% and 20% deduction is £60. That’s over £240 more in your pocket each month.

Gross payment status (0% deduction)

If you’ve been working under CIS for a while and meet the right criteria, you can apply for Gross Payment Status. This means no deductions are made from your payments at all. You receive the full amount and sort your tax later through Self Assessment.

To qualify, HMRC looks at your turnover, record keeping and payment history. It’s a great option for experienced subcontractors or those running limited companies, but it’s not for everyone, and it comes with more responsibility.

Who needs a CIS card?

Not everyone in construction needs a CIS card – but if you’re a self-employed construction worker, it’s probably essential. The card proves you’re registered with the CIS and tells contractors how much tax to deduct.

You’ll need a CIS card if you’re a subcontractor working in:

  • Building and civil engineering
  • Electrical or plumbing installations
  • Roofing, plastering or carpentry
  • Painting and decorating
  • Scaffolding or plant hire
  • Any labour-only subcontracting roles

These are all jobs that fall under the CIS subcontractor category. If this sounds like you, not having a CIS card could cost you 10% of your income every time you get paid.

You don’t need a CIS card if:

  • You’re a direct employee paid through PAYE
  • You work only for domestic customers (like private homeowners)
  • Your trade is outside the CIS scope (some design, architecture or admin work)

Not sure where you fall? If you’re providing labour as a self-employed worker on a construction site, chances are you need to register.

How to get your CIS card

Getting your CIS card is all about registering properly with HMRC. Once you're set up, you’ll receive confirmation of your CIS status, and in many cases, a physical card to prove it.

What you’ll need to register:

To apply for your CIS card, make sure you have:

  • Your Unique Taxpayer Reference (UTR) number
  • Your National Insurance number
  • Proof of identity and address
  • A UK bank account in your name

If you’re not already registered as self-employed, you’ll need to do that first through HMRC.

How to apply:

  • Register online at the official HMRC CIS registration portal
  • Follow the steps to confirm your details
  • Choose whether you’re registering as a sole trader or limited company

Once your registration is complete:

  • HMRC will activate your CIS status
  • Your contractors will be able to verify you
  • You may receive a physical CIS card as proof of your registration

How long does it take?

CIS applications are usually processed within a few days, but it can take longer if HMRC needs to verify your information. Make sure everything is accurate to avoid delays.

CIS and your tax return

Once you’re registered for CIS, your tax situation doesn’t stop there. Every year, you’ll need to complete a CIS tax return to balance what you’ve paid with what you actually owe.

Why your tax return matters:

  • Contractors deduct tax through CIS, but it might not match your final bill
  • You could be due a CIS tax refund if you’ve overpaid
  • You’ll also need to declare any other income

Claiming back overpaid tax

Most self-employed construction workers pay too much tax through CIS. That’s because contractors deduct tax without knowing your actual expenses or personal allowance. By completing your tax return, you can:

What expenses can you claim?

To reduce your tax bill and boost your refund, you can claim for:

  • Tools and equipment you’ve paid for
  • Protective clothing and safety gear
  • Travel costs between job sites
  • Vehicle expenses used for work
  • Phone bills, business insurance and admin costs

Keep good records

Make sure you keep:

  • All your CIS payment statements
  • Receipts for tools, travel, and materials
  • Notes on mileage and fuel

This makes your tax return quicker, more accurate, and more likely to land you a decent refund.

Common CIS mistakes costing you money

CIS is meant to keep things simple, but it can end up costing you if you’re not careful. Here are some of the most common mistakes that leave subcontractors out of pocket.

Not registering for CIS

  • You get 30% deducted instead of 20%
  • You miss out on better tax rates and more control
  • You lose money every time you get paid

Poor record keeping

  • Forgetting to track CIS deductions
  • Not keeping receipts for construction work expenses
  • Risk of errors in your Self Assessment tax return

Not claiming expenses

If you’re not claiming what you’re entitled to, you’re giving money back to HMRC. Don’t forget about:

  • Tools and equipment you’ve bought for work
  • Travel between jobs and sites
  • Work clothing like boots and high-vis
  • Vehicle costs if you use a car or van for work

Missing out on refunds

Even with the right CIS deductions, most people pay more than they actually owe. That’s why:

  • Many subcontractors are due a CIS refund
  • You could get money back for emergency tax or multiple contractor deductions
  • Year-end reviews can uncover CIS overpayments

Young workers entering construction

Just starting out in construction? Getting your CIS registration sorted early can save you a lot of money and hassle.

Registering from day one means you’ll avoid the higher 30% tax rate and show contractors you’re ready to work. You’ll need to sign up as self-employed, get your UTR number, and apply for your CIS card. It’s also smart to open a separate bank account to manage your work income.

Start keeping receipts, track your mileage, and save a bit for your tax return each month. These habits will make your life easier and could mean a bigger refund later on.

Red flags: you might be owed CIS refunds

If you’re working in construction and haven’t checked your tax situation, there’s a good chance HMRC owes you money. Many subcontractors overpay without realising it.

You could be due a refund if:

  • You’ve been working as a subcontractor without CIS registration, meaning 30% tax is being taken instead of 20%.
  • You’re paying for tools, travel, or safety gear out of pocket but not claiming them on your tax return.
  • You’ve worked for multiple contractors in the same tax year. Each one might be deducting tax without seeing the full picture.
  • You’ve never claimed work expenses, like fuel, equipment or clothing.

These are all signs of CIS overpayment. If any of them apply to you, don’t wait. Get your money back before HMRC keeps more than they should.

Construction workers are owed millions in unclaimed refunds

Every year, thousands of subcontractors overpay their tax. If you’re working under CIS, you could be due a refund worth £2,000 to £4,000.

At RIFT, we’ve reclaimed over £350 million for people like you. We specialise in CIS refunds and construction tax rebate claims, with a focus on tools, travel, vehicle costs and equipment.

Whether you need help with CIS registration, sorting your Self Assessment, or making sure you’re not being overtaxed, we’re here to help.

Don’t leave your hard-earned money in HMRC’s hands. Let’s get it back where it belongs. Check if you’re owed a refund now.

CIS Tax Rebate Calculator