A CIS tax refund is the money HMRC returns to subcontractors who have overpaid their tax through the Construction Industry Scheme. If you are registered under CIS, contractors deduct 20% from your payments. If you are not registered, they deduct 30%.
These deductions count as advance payments towards your annual tax bill. If your actual tax liability is less than what was deducted, you can claim the difference as a refund.
This often happens when you include allowable expenses in your tax return, which reduce your taxable profit. Therefore, the gap between what you owe and what as deducted, is what you can claim back.
Who Can Claim a CIS Refund?
To be eligible for a CIS refund, you must meet the following conditions:
- You are registered as a subcontractor under CIS
- You have had tax deducted from your payments by a contractor
- You are a sole trader, part of a partnership or operating as a limited company
- You have overpaid tax or National Insurance
If your tax return shows an overpayment, HMRC owes you a refund.
What Can You Claim For?
Alongside overpaid tax, you can claim for certain business expenses that reduce your taxable income. These include:
- Tools and equipment used exclusively for work
- Protective gear such as hard hats and gloves
- Travel to and from job sites, including mileage and fares
- Accommodation when working away from home
- Job-specific training, licences and certifications
- Work-related phone bills, stationary and admin costs
Only claim expenses directly related to your work. Personal costs, like takeaway meals or private phone use, do not count. You should also keep receipts and records, as HMRC may request evidence.
What Do You Need to Make a Claim?
- Unique Taxpayer Reference (UTR)
- Business name, address and phone number
- PAYE reference number (if applicable)
- Estimated overpaid tax amount
- Bank account details for the refund
If you are claiming for the current tax year, you should also include:
- Payment and Deduction Statements (PDS)
- Bank statements showing payments
How to Claim Your CIS Refund
For Sole Traders and Partnerships
- Complete your Self Assessment tax return
- Enter your CIS deductions in Box 38
- Include all income and allowable expenses
- Submit your return before 31st January
- HMRC will calculate your total tax liability
- If you have overpaid, HMRC will issue a refund directly to your bank account
For Limited Companies
The process is slightly different if you operate as a limited company.
If you run a payroll system:
- Report CIS deductions through your monthly payroll returns
- At the tax year-end, offset unclaimed CIS against PAYE, VAT or Corporation Tax
- If you owe no tax, request a refund from HMRC
If you do not run payroll:
- Submit a written claim after the tax year ends
- Include company and bank details
- Indicate whether to apply the refund to other tax liabilities or send it to your account
How to Submit Your CIS Refund Claim
Online Submission
- Sign into your HMRC account using your Government Gateway credentials
- Go to the Self Assessment section
- Enter your income, expenses and CIS deductions
- Submit the return
- Track your refund progress online (processing typically takes 6 to 12 weeks)
Claiming by Post
- Write a letter detailing your claim
- Mark the envelope clearly with “CIS”
- Post to:
PT Operations North East England
HM Revenue and Customs
BX9 1BX
United Kingdom
You should file your refund before the tax year ends on 5th April. Additionally, limited companies should not attempt to claim refunds through their Corporation Tax return.
Amending a Claim
Online Amendments
- Sign into your HMRC account
- Locate your submitted claim
- Edit and resubmit the corrected details
Amendments by Post
- Send a letter labelled “Revised Claim”
- State the new claim amount
- Reference your original submission
How Long Will It Take to Get a Refund?
Most refunds arrive within 4 to 8 weeks. Delays can occur if:
- Information is missing or incorrect
- The claim is made before all records are complete
- HMRC requests additional documentation
Track your progress online or contact HMRC if it takes longer than 4 working days.
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