Self assessment & personal tax
CIS subcontractors often overpay tax because 20% or 30% is deducted at source. A refund claim compares deductions to actual liability.
Written and reviewed by Waqas Sagar Member of ICAEW, Fellow of ACCA, Fellow of AAT, a double graduate and entrepreneur at heart, helping startups grow and serving thousands of businesses nationwide with an excellent team. Published by LimitedCompany.Accountants, 12 London Road, Morden, London SM4 5BQ. Reviewed 12 September 2026 against 2026/27 UK rates and current Companies House and HMRC guidance.
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QuickBooks PartnerCertified ProAdvisor100+ yearsCombined team experienceFully insuredUp to £2m indemnityContractors deduct 20% (or 30% if you are not verified) from your gross pay under CIS, before your actual costs and personal allowance are taken into account. A Self Assessment return sets the deductions suffered against your real tax bill, and any excess is refunded.
Why subcontractors overpay
What affects the process
Contractors deduct 20% (or 30% if you are not verified) from your gross pay under CIS, before your actual costs and personal allowance are taken into account. A Self Assessment return sets the deductions suffered against your real tax bill, and any excess is refunded.
The CIS deduction is calculated on labour only, ignoring materials, and takes no account of your business expenses, pension contributions or personal allowance. Most subcontractors with genuine costs and no other income end up having paid more than their actual liability across the year.
The refund calculation on the return sets total CIS deductions shown on your monthly statements against total tax and Class 4 National Insurance due after allowable expenses and allowances, with the difference repayable.
Accuracy and completeness of the return matter most: HMRC checks that your CIS deductions match what contractors reported to them, so gaps in your statements or unregistered contractors can hold up matching. Filing as early as possible after the tax year ends, rather than waiting until January, gets the claim into the system sooner.
HMRC may open a check on a repayment claim, particularly where deductions or expenses look unusual compared with previous years, and being registered correctly for CIS with up to date verification reduces the risk of the higher 30% rate being applied in the first place.
Rates, thresholds and deadlines quoted here reflect the 2026/27 UK position and current Companies House and HMRC guidance. Check GOV.UK, or ask us, before relying on them for your own company.
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We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
No, the claim is made through the Self Assessment return once the tax year has ended, though you can file as soon as the return is ready.
Request them directly, or use your bank records and remittance advices as supporting evidence.
No, VAT and CIS deductions are separate systems and do not offset against each other.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
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Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
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The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
No. This page explains general UK rules and common accounting treatment. Your facts, contracts and wider tax position must be reviewed before you rely on a conclusion.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
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