If you work as a subcontractor in the construction industry, there is a very good chance you have overpaid tax. The CIS system requires contractors to deduct 20% (or 30% if you are unregistered) from every payment they make to you and send it directly to HMRC. This happens before you see the money — before any expenses have been considered, and before your personal allowance has been applied.
The result is that most CIS subcontractors pay significantly more tax during the year than they actually owe. The only way to get that money back is to file a Self Assessment tax return.
This guide explains exactly how to claim your CIS refund, what you can claim, how much you are likely to get back, and how long it takes.
Why Most CIS Subcontractors Are Owed a Refund
The 20% CIS deduction is calculated on your gross earnings. It does not take into account:
Your personal allowance (£12,570 in 2026/27 — the first £12,570 you earn is tax-free). Your business expenses (tools, fuel, work clothing, materials you buy yourself, phone, and more). Your pension contributions. Any other deductions you are entitled to.
When all of these are factored in, your actual tax liability is almost always lower — often significantly lower — than the 20% that has been deducted from your payments.
Example:
Gross CIS earnings: £38,000
CIS deductions at 20%: £7,600 sent to HMRC
Personal allowance: £12,570 (tax-free)
Business expenses: £6,000 (tools, fuel, phone, PPE)
Taxable profit: £38,000 minus £6,000 = £32,000
Tax on £32,000 after personal allowance: approximately £3,886
Amount already paid via CIS: £7,600
Refund: approximately £3,714
This is a real-world example of what a typical Harrow or Stanmore CIS subcontractor might be owed. The exact figure depends on your earnings, expenses, and whether you have any other income.
Step 1: Register for Self Assessment
If you have not already done so, you must register for Self Assessment with HMRC to claim your CIS refund. CIS deductions cannot be reclaimed any other way.
Register at gov.uk using form CWF1 (if you are self-employed) or by calling HMRC on 0300 200 3310. Once registered, HMRC issues you a UTR (Unique Taxpayer Reference) number, which you need to file your return.
If you are already registered for Self Assessment (perhaps you have filed before or have other self-employment income), you do not need to re-register.
Step 2: Gather Your CIS Deduction Statements
Your contractors are legally required to give you a CIS deduction statement for every payment they make to you. These statements show:
The gross amount of the payment. The amount of materials (which are not subject to CIS deduction). The CIS deduction taken. The net amount paid to you.
Collect all your CIS statements for the tax year you are claiming (6 April to 5 April). If a contractor has not given you statements, ask for them — it is a legal obligation.
The total of all CIS deductions across your statements is the amount that has been paid to HMRC on your behalf. This is the starting point for your refund claim.
Step 3: Calculate Your Business Expenses
The more legitimate expenses you claim, the lower your taxable profit, and the larger your refund. Common allowable expenses for CIS subcontractors include:
Tools and equipment (not replaced by the contractor). Protective clothing and PPE. Vehicle costs — either the approved mileage rate (45p per mile for the first 10,000 miles, 25p per mile thereafter) or actual vehicle running costs (fuel, insurance, MOT, repairs) on the business proportion. Materials you purchase yourself that are not reimbursed. Mobile phone (the business-use proportion). Training and professional development directly related to your trade. Accountancy fees.
You cannot claim: travel between home and a regular fixed workplace, personal clothing, or any expenses the contractor has already paid.
Keep receipts for everything. If you lose receipts, a bank statement showing the payment and a reasonable description of the expense is usually sufficient for modest amounts.
Step 4: File Your Self Assessment Return
Your CIS refund is claimed through your annual Self Assessment tax return, which covers the tax year from 6 April to 5 April.
You have until 31 January following the end of the tax year to file online. For the 2025/26 tax year (which ended 5 April 2026), the filing deadline is 31 January 2027.
However, do not wait until January. Filing in April or May — as soon as the tax year ends — means your refund is processed during a quiet period at HMRC, arrives months sooner, and reduces the risk of delays caused by HMRC's January backlog.
On your Self Assessment return, the CIS deductions are entered in the CIS section. HMRC's system then calculates your tax liability, compares it to the deductions already paid, and calculates any refund due.
Step 5: Receive Your Refund
HMRC processes most CIS refunds within 4 to 8 weeks of the return being filed outside the January period. Returns filed in January may take up to 12 weeks.
HMRC may write to you asking for evidence of your CIS deduction statements to verify the claim. Respond promptly with your statements — delays in responding cause delays in your refund.
The refund is paid by BACS directly to your bank account (if your bank details are on your HMRC account) or by cheque to your registered address. Always keep your bank details up to date on your HMRC Personal Tax Account.
How Far Back Can You Claim?
You can submit a Self Assessment return for any tax year back four years from the current date. In May 2026, this means you can file returns going back to 2021/22.
If you have been working as a CIS subcontractor for several years and never filed, you may be owed refunds across multiple years. Filing all outstanding years at once is possible and we regularly do this for subcontractors who are catching up.
There are late filing penalties for missing the January deadline, but these can often be appealed where there is a reasonable excuse.
A Real-Life Example
Client C was a CIS plasterer based in Wembley. He had worked as a subcontractor for four years and had never filed a Self Assessment return. His contractors had been deducting 20% from every payment.
When he came to us, we reviewed his CIS statements and bank records for all four years. His total CIS deductions across the four years came to £31,400.
After claiming all allowable expenses — tools, van running costs, materials, phone, and PPE — his actual tax liability across all four years was £8,200.
We filed all four outstanding returns. After accounting for late filing penalties (which we partially appealed), he received a net refund of approximately £21,800 — money that had been sitting with HMRC for years.
Frequently Asked Questions
Need help with your tax position?
At Your Tax Help Accountants in Stanmore, we work with clients across Harrow, Wembley, Edgware and London. Fixed fees, expert advice, no jargon.
Or email info@yourtaxhelp.co.uk | yourtaxhelp.co.uk