CIS Tax Calculator UK 2026/27: Deductions and Refunds
Work out exactly what you will be paid after CIS, and whether you are likely to get money back at the end of the tax year. This free CIS tax calculator follows HMRC’s rules: the deduction comes off labour only, never materials, plant hire or VAT. The refund estimator uses the 2026 to 2027 Income Tax and National Insurance rates.
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CIS Invoice Calculator
What will I actually be paid?
CIS Tax Refund Estimator
Will I get a CIS refund this year?
Uses 2026 to 2027 rates for England, Wales and Northern Ireland: Personal Allowance £12,570 (reduced by £1 for every £2 over £100,000), Income Tax 20% / 40% / 45%, Class 4 National Insurance 6% on profits from £12,570 to £50,270 and 2% above. Scottish Income Tax bands are different, and student loan repayments, other income and Marriage Allowance are not included. This is an estimate, not tax advice.
Dayrates is an invoicing app built for UK tradespeople on CIS: mark a line as labour and the deduction is worked out for you, with materials left out. We tested it and the CIS maths came out right. 14-day free trial, no card needed.
Try Dayrates Free →How CIS Deductions Work
Under the Construction Industry Scheme, a contractor takes tax off your payments and sends it to HMRC for you. Those deductions are advance payments towards your Income Tax and National Insurance bill, which is why many subcontractors end up with a refund once their expenses are counted.
| Your CIS status | Deduction |
|---|---|
| Registered for CIS | 20% |
| Not registered | 30% |
| Gross payment status | 0%, you pay your tax through Self Assessment |
The contractor must not take the deduction from:
- VAT
- Materials you paid for yourself
- Plant hired for the job
- Consumable stores
- Fuel, except fuel used for travelling
- Manufacturing or prefabricating materials
Source: HMRC’s guidance on making CIS deductions and deductions from subcontractor payments.
Worked Example
You invoice £600 labour and £250 of materials you bought, and you are CIS registered but not VAT registered. The contractor takes 20% off the labour only: 20% of £600 is £120. You are paid £850 minus £120, which is £730. The £120 goes to HMRC as an advance payment of your tax.
At the end of the year, the refund estimator above compares everything deducted with the tax and National Insurance you actually owe on your profit. With £40,000 income, £8,000 expenses and £5,600 deducted, the estimated bill is £5,051.80, so you would be due back around £548.
How to Claim a CIS Refund
- Sole traders claim CIS deductions back through their Self Assessment tax return. Enter the total deducted in the self-employment section and HMRC sets it against your bill.
- Keep every payment and deduction statement. Contractors must give you one each month; the totals should match what HMRC holds.
- Claim every allowable expense. Missed expenses are the main reason subcontractors overpay. See what expenses a tradesperson can claim.
- File early. You can file from 6 April, after the tax year ends, and refunds usually arrive sooner than waiting for the January deadline.
Frequently Asked Questions
If you are registered for CIS, contractors deduct 20% from the labour part of your payments. If you are not registered, they deduct 30%. If you have gross payment status, nothing is deducted and you pay your tax through Self Assessment.
No. HMRC rules say the deduction must not be taken from materials you paid for yourself, VAT, plant hired for the job, consumable stores, fuel (except for travelling) or prefabricating materials. In practice it comes off your labour.
Sole traders claim CIS deductions back through their Self Assessment tax return. You enter the total CIS deducted in the self-employment section, HMRC sets it against your Income Tax and National Insurance bill, and refunds any overpayment.
The 20% deduction is taken from your labour before your expenses and Personal Allowance are counted. Once materials, van costs, tools and the £12,570 tax-free allowance are taken into account, the tax you actually owe is often lower than what was deducted.
The VAT domestic reverse charge changes who accounts for VAT, not the CIS deduction. When it applies, you do not charge VAT on the invoice and the contractor accounts for it, but CIS is still deducted from your labour as normal.
It uses 2026 to 2027 rates for England, Wales and Northern Ireland: a £12,570 Personal Allowance, Income Tax at 20%, 40% and 45%, and Class 4 National Insurance at 6% on profits between £12,570 and £50,270 and 2% above. Scottish Income Tax bands are different.
TradeStack HQ helps UK tradespeople find the best tools to run smarter businesses. Some links on this page are affiliate links (Dayrates); we may earn a commission if you sign up, at no extra cost to you. This calculator gives estimates based on HMRC rules and 2026 to 2027 rates, checked October 2026. It is not tax advice; check your own position with HMRC or an accountant. See how we test and check.