Self-Employed Builder Tax Guide: CIS, Expenses & Self-Assessment
By Sardar Muhammad, AAT • • 11 min read
📋 Quick Summary
- CIS deductions (20%) are advance tax payments – you may be owed a refund
- Register for self-assessment and file by 31st January
- Claim all allowable expenses: tools, materials, van costs, workwear
- Keep records for 6 years – HMRC can check back this far
Who Is This Guide For?
This guide is for self-employed tradespeople in the construction industry, including:
- Builders – general construction work
- Joiners & carpenters
- Electricians
- Plumbers & gas engineers
- Plasterers
- Painters & decorators
- Roofers
- Tilers & floorers
- Bricklayers
- Labourers
Understanding CIS (Construction Industry Scheme)
If you're a subcontractor in the construction industry, you've probably had CIS deductions taken from your pay. Here's how it works:
How CIS Works
- Contractors must deduct tax from subcontractor payments
- Registered subcontractors: 20% deduction
- Unregistered subcontractors: 30% deduction
- Contractor pays this to HMRC on your behalf
- When you file your tax return, CIS deductions are credited against your tax bill
- If deductions exceed your tax due, you get a refund
CIS Rebates: Getting Your Money Back
Many construction workers are owed money from HMRC because their CIS deductions exceed their actual tax liability. This commonly happens when:
- You have significant allowable expenses
- You earn below the higher tax thresholds
- You didn't work for the full tax year
- You haven't filed your tax return yet
Example CIS Rebate
Gross income: £40,000
CIS deducted (20%): £8,000
Allowable expenses: £12,000
Taxable profit: £28,000
Actual tax due: £3,086 (on £15,430 above personal allowance)
CIS already paid: £8,000
CIS rebate due: £4,914! 💰
Registering for CIS
If you're not registered for CIS, you'll have 30% deducted instead of 20%. Register to save money:
- Go to GOV.UK CIS registration
- You'll need your National Insurance number and UTR (Unique Taxpayer Reference)
- You must also be registered for self-assessment
- Registration reduces deductions from 30% to 20%
Builder Allowable Expenses
Claim every legitimate expense to reduce your tax bill:
🔧 Tools & Equipment
| Hand tools (hammers, screwdrivers, chisels) |
| Power tools (drills, saws, sanders) |
| Tool boxes and bags |
| Ladders and scaffolding (hire or purchase) |
| Measuring equipment |
| Generator hire |
🚐 Vehicle Costs
Two options:
- Actual costs: Fuel, insurance, repairs, road tax, MOT (business proportion)
- Mileage rate: 45p per mile (first 10,000), 25p thereafter
For vans doing 20,000+ business miles, actual costs often work out better.
👷 Workwear & Safety
- Steel-toe boots
- Hard hats
- High-visibility clothing
- Work trousers (if specific to work)
- Gloves and eye protection
- Ear defenders
📋 Other Expenses
- Materials – if you supply them (nails, screws, fittings)
- Insurance – public liability, tools cover
- Phone – business proportion
- Training & qualifications – CSCS, gas safe, Part P
- Trade subscriptions – FMB, NICEIC, etc.
- Subcontractor costs – if you hire help
- Accountancy fees
- Travel – to sites (not regular commute to one location)
- Use of home – £6/week flat rate or proportion of bills
How to File Your Tax Return
- Gather documents: CIS statements from contractors, receipts, bank statements
- Calculate income: Total gross payments before CIS
- Total expenses: Add up all allowable expenses
- Complete self-assessment: Online at HMRC or through an accountant
- Include CIS deductions: Enter total CIS suffered
- Submit by 31st January
Important Deadlines
- 5th April: End of tax year
- 5th October: Register for self-assessment (if new)
- 31st January: Online tax return deadline + payment
- 31st July: Payment on account (if applicable)
Frequently Asked Questions
What is CIS and how does it work?
CIS requires contractors to deduct 20% from subcontractor payments (30% if unregistered). This is paid to HMRC as advance tax. When you file self-assessment, you can claim back any overpaid CIS.
Can I claim back CIS deductions?
Yes! If your CIS deductions exceed your actual tax bill, you'll receive a refund. This is common if you have significant expenses. File your self-assessment to claim your CIS rebate.
What expenses can builders claim?
Builders can claim tools, materials, vehicle costs, workwear, insurance, phone bills, training, subcontractor costs, and home office expenses. Keep all receipts and records.
Get Your CIS Rebate
I specialise in construction industry tax returns. Let me maximise your expenses and claim back your CIS.
Sardar Muhammad, AAT Certified
Sardar is an AAT certified accountant and founder of LimeTree Accounting Solutions in Glasgow. He specialises in helping construction workers and tradespeople with CIS rebates and tax returns.