CIS Verification Tool

The standard deduction rate is 20% of the labour portion of the invoice. Subcontractors without a valid registration are subject to a higher rate of 30%. These deductions are paid directly to HMRC and credited against the subcontractor's tax liability.

Subcontractors with gross payment status receive their full invoice amount without any CIS deductions. To qualify, they must have a clean tax history and meet specific turnover thresholds. This status removes the need for contractors to withhold tax from payments.

Employers pay 15% National Insurance on earnings above £5,000 per employee. This rate applies to most standard employment contracts within the CIS framework. Lower earnings thresholds may apply for specific categories of workers.

Dividends are taxed at 10.75% for the basic rate band, 35.75% for the higher rate, and 39.35% for the additional rate. The tax-free dividend allowance is set at £500 for this tax year. These rates apply after the allowance is deducted from total dividend income.

Businesses must register for VAT if their taxable turnover exceeds £90,000 in any rolling 12-month period. Making Tax Digital for Income Tax Self Assessment (MTD ITSA) becomes mandatory for sole traders and landlords with annual income over £50,000. Digital record-keeping is required for all qualifying entities.