CIS monthly return: how to file it

Your CIS monthly return tells HMRC every payment you made to subcontractors in the last tax month and every deduction you took from those payments. It has to reach HMRC by the 19th of every month following the last tax month. If you made no payments at all you still have to act, either by filing a nil return or by asking HMRC to make your scheme inactive. Missing the deadline by a single day is an automatic £100 penalty.

The CIS return deadline

The 19th. Every month, following the last tax month.

Tax months don’t line up with calendar months, which is where this trips people. A tax month runs from the 6th to the 5th. So the tax month of 6 May to 5 June is reported on a return due by 19 June.

There’s no grace period and no sliding scale at the front end. One day late is £100, and the penalty lands whether you owed HMRC £14,000 or nothing at all.

Set a recurring reminder for the 12th or so. Chasing a subcontractor for a materials breakdown on the afternoon of the 19th is a bad way to spend a day, and it’s how figures get estimated badly.

What goes on the return

For the tax month just ended:

every subcontractor you paid

the gross amount of each payment, excluding VAT

the cost of materials excluding VAT, where you deducted

the deduction you took from each payment

a declaration that you’ve considered the employment status of everyone on the return, and that everyone has been verified

That employment status declaration isn’t a formality. You’re confirming you’ve checked that these people should be subcontractors rather than employees. HMRC can penalise you if someone on the list should have been on the payroll.

Filing it

You file through the free HMRC CIS online service or through commercial CIS software. Same information either way, and the return covers the tax month that ended on the 5th.

The figures should come straight off the payment and deduction statements you’ve already issued. If you’re rebuilding them from bank transactions at the last minute, that’s a paperwork problem rather than a filing problem, and it will keep happening every month until you fix the order you do things in.

Nil returns and going inactive

If you made no payments to subcontractors in a tax month, doing nothing is the one option that isn’t available.

You either file a return showing your payments were zero, which is a nil return, or you ask HMRC to make your scheme inactive. Inactive status is for when you know you won’t be paying subcontractors for up to 6 months, and HMRC stops sending you returns for that period. You have to file again as soon as you start paying subcontractors.

Quiet winter, no subbies on the books, nothing filed and no inactivity request. That’s three £100 penalties for three months of no work at all.

Late filing penalties

1 day: £100

2 months: £200

6 months: £300 or 5% of the deductions, whichever is higher

12 months: £300 or 5% of the deductions, whichever is higher

More than 12 months: up to £3,000 or 100% of the deductions, whichever is higher

These stack. A return that’s a year late has collected the earlier penalties on the way.

Worked example

You pay three subcontractors in the tax month running 6 May to 5 June. Gross invoices of £3,000, £5,400 and £2,200. The middle one included £1,400 of materials he paid for and has receipts for. All three verified as registered, so 20%.

Deductions: £600 on the first. On the second, £5,400 less £1,400 of materials leaves £4,000 liable, so £800. £440 on the third. Total deducted, £1,840.

The return is due by 19 June and it lists all three payments, the £1,400 of materials, and the £1,840 of deductions.

Forget it until August and you’re £200 down. Forget it until December and you’re looking at £300 or 5% of £1,840, so £300. On a return that took fifteen minutes to file.

Records you have to keep

Keep the gross amount of each payment invoiced by subcontractors excluding VAT, the deductions you made, and where you deducted, the cost of materials invoiced excluding VAT.

Hold all of it for at least 3 years after the end of the tax year it relates to. HMRC can ask to see your CIS records at any time, and you could be fined up to £3,000 if you can’t produce them.

Common mistakes

Working to calendar months. Tax months run 6th to 5th. The return due on 19 June covers 6 May to 5 June.

Skipping a nil return. No payments still means a nil return or an inactivity request. Silence costs £100.

Filing without issuing statements first. The statement is due within 14 days of the tax month ending, which is before the return. Do them in that order and the return fills itself in.

Deducting from the full invoice. Materials, plant hire, consumable stores and VAT come off before the percentage.

Guessing materials figures. Ask for receipts. If there aren’t any, HMRC expects you to estimate the cost, not to ignore it.

Do this in FieldHive

The return is only painful when the underlying paperwork isn’t there. Generate each subcontractor’s payment and deduction statement free in your browser as you pay them, with the deduction worked out from the gross and materials figures, and the monthly return becomes a transcription job. For invoicing under CIS yourself, the CIS and VAT invoice generator handles the deduction and the reverse charge together.

Aid, not advice

This guide explains how the CIS monthly return works so you can file it on time and get the figures right. It is not tax advice. Employment status decisions in particular carry real risk, and if you are unsure whether someone should be a subcontractor or an employee, take advice from your accountant or HMRC before you file.

Deadlines, penalties and rates checked on gov.uk August 2026: the 19th filing deadline, the late-filing penalty ladder, nil returns and inactivity, the 3-year record retention period, and CIS deduction rates 20% / 30% / 0%.