CIS tax rebate calculator

Why CIS subcontractors get tax refunds

Contractors deduct 20% from every payment of labour, from the first pound. Your real tax bill is only worked out at the end of the year, on your profit after expenses, and the first £12,570 of your income is tax free. The deductions ignore both, so across a year they often add up to more than you owe.

That is why this is a tax rebate, a tax refund and a tax return question all at once: you file a self assessment return, HMRC works out the real bill, and the difference is refunded or, if you owe more, paid. With a PAYE job as well, or no CIS at all, the self-employed tax calculator works the same bill.

How the CIS refund is calculated

Your refund is the CIS deducted during the year, minus the income tax and Class 4 National Insurance due on your profit. Profit is your gross CIS income less your allowable expenses.

A worked example for 2026/27. You earned £32,000 gross, had £6,000 of expenses and were registered, so £6,400 was deducted. Your profit is £26,000.

Income tax is 20% on the £13,430 above the Personal Allowance: £2,686. Class 4 National Insurance is 6% on the same £13,430: £805.80. The total due is £3,491.80.

The refund is £6,400 deducted, less £3,491.80 due, which is £2,908.20.

Every extra £1,000 of genuine expenses is worth about £260 back to a basic rate taxpayer: 20% tax plus 6% Class 4.

What a 30% deduction does to your refund

Unregistered subcontractors have 30% deducted, so more comes back at the end of the year, but you wait up to a year for money that registering would have left in your pocket each week.

An example: £24,000 gross, £4,000 of expenses, £7,200 deducted at 30%. Profit is £20,000, the total due is £1,931.80, and the refund is £5,268.20.

Do higher earners still get a CIS refund?

Sometimes, but it is small, and above the higher rate threshold you can end up owing. An example: £70,000 gross, £10,000 of expenses and £14,000 deducted. Profit is £60,000. Income tax is £11,432 and Class 4 is £2,456.60, so the refund is £111.40.

There are no payments on account here either, because more than 80% of the tax was already taken at source through CIS.

Refunds are the end of the year. During it, the day rate calculator and the markup calculator set prices that cover the tax, a quote that splits labour from materials gets the deduction right, main contractors will usually ask for a method statement and risk assessment, and the late payment interest calculator and the guide to a customer refusing to pay cover a contractor who pays late.

What expenses can CIS subcontractors claim?

You can claim the costs of running your business, but not personal spending. The main ones for a subcontractor are below; the self-employed allowable expenses list has the full list by category, with what HMRC says no to:

• Business mileage: 55p a mile for the first 10,000 miles and 25p after, if you use simplified expenses. Travel between home and a regular place of work does not count.
• Tools and equipment you buy for the work.
• Protective clothing and workwear you need for the job. Everyday clothing does not count, even if you wear it on site.
• The business share of your phone and internet.
• Insurance for the business, such as public liability.
• Accountancy fees and bookkeeping software.
• Training that keeps your skills current or supports the business, including renewing cards and tickets.
• Hotels and meals when you work away overnight.
• Working from home on the admin: a flat rate from £10 to £26 a month, by hours worked at home.

Keep receipts. If your expenses are under £1,000, you can claim the trading allowance↗ (opens in a new tab) of £1,000 instead, but never both. The calculator suggests it when it helps. VAT-registered subcontractors whose work is reverse charged can compare the VAT flat rate scheme with standard VAT.

Do you get all your CIS tax back?

No. You get back the difference between what was deducted and what you owe. The deductions are an advance payment of your tax and National Insurance, so the part that covers your real bill stays with HMRC. Only a year with a profit under the Personal Allowance would see everything come back.

How to claim a CIS refund

As a sole trader you claim through your self assessment return. Record your total pay before deductions as income, and the total deductions contractors took as CIS deductions, using the figures from your payment and deduction statements. HMRC works out the tax and repays the difference.

Register for self assessment by 5 October 2027 if it is your first year, and file online by 31 January 2028. A limited company does not use self assessment for this: it reclaims CIS deductions through its payroll submissions. gov.uk explains both↗ (opens in a new tab).

How do I check my CIS refund?

Sign in to your HMRC online account. It shows your return, what you owe or are owed, and any repayment. If the CIS deductions HMRC holds do not match your statements, the refund will be wrong, so check the totals against your statements before you file.

CIS refunds in Scotland

If you are a Scottish taxpayer, income tax on your profit uses Scottish rates and bands, which have more bands than the rest of the UK. National Insurance is the same everywhere. Choose Scotland in the calculator and it uses the right bands for the year you pick.

2026/27 tax rates used by this calculator

The Personal Allowance falls by £1 for every £2 of income over £100,000. Earlier years in the calculator use their own rates, all from gov.uk↗ (opens in a new tab).