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Estimate a CIS deduction from the qualifying payment amount using the status returned by HMRC verification. UK tax year 2026/27.
Editable sample values are loaded for 2026/27. Replace them with the payment, supported costs and status returned by HMRC verification; the results update from your current inputs.
From £5,000.00 subject to CIS at 20% (Registered and verified by HMRC): HMRC deduction £1,000.00 and payment to the subcontractor £4,000.00. The deduction is an advance payment credited towards the subcontractor's tax position.
Annual illustration: At 12 payments a year, repeating this same qualifying amount and status. £12,000.00 withheld and £48,000.00 paid.
The CIS-deductible payment is split into net payment and withholding (£5,000.00 total).
| Item | Amount |
|---|---|
| Payment before VAT | £6,000.00 |
| Qualifying excluded costs entered | −£1,000.00 |
| CIS-deductible payment | £5,000.00 |
| CIS rate | 20% |
| CIS withheld | −£1,000.00 |
| Net payment | £4,000.00 |
Same qualifying amount; only the status returned by HMRC changes.
| HMRC status | Rate | Deduction | Net payment |
|---|---|---|---|
| Registered and verified by HMRC | 20% | £1,000.00 | £4,000.00 |
| HMRC has not verified registration | 30% | £1,500.00 | £3,500.00 |
| Gross Payment Status confirmed by HMRC | 0% | £0.00 | £5,000.00 |
At 12 payments a year, repeating this same qualifying amount and status. (£ per year).
| HMRC status | Payments/year | Annual deductions | Annual net paid |
|---|---|---|---|
| Registered and verified by HMRC (20%) | 12 | £12,000.00 | £48,000.00 |
| HMRC has not verified registration (30%) | 12 | £18,000.00 | £42,000.00 |
| Gross Payment Status confirmed by HMRC (0%) | 12 | £0.00 | £60,000.00 |
The model subtracts the qualifying costs entered from the payment before VAT, applies the selected HMRC status rate and repeats that payment for the annual illustration. Only qualifying subcontractor-paid costs may be excluded; check the rules and records for VAT, materials, fuel, plant hire, consumables and manufacturing costs. VAT treatment depends on the subcontractor's VAT status. The 30% rate does not decide whether a person is permanently unregistered. This page cannot verify a subcontractor, classify a contract, or calculate final Income Tax or Corporation Tax.
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These current HMRC sources support the CIS rates, verification, qualifying exclusions, returns and payment explanations. The calculator is a simplified 2026/27 illustration and does not verify a subcontractor or contract.