CIS Tax Rebate Calculator 2026/27

CIS withholding is not your final tax bill

Under CIS, a contractor deducts money from subcontractor payments and sends it to HMRC. For a sole trader, these are advance payments towards Income Tax and National Insurance. Your Self Assessment return reconciles them with the tax actually due. A refund is possible, but receiving deductions at 20% does not mean you get 20% of your income back. Read HMRC's repayment guidance.

Your gross construction income includes amounts paid for materials as well as labour. Do not declare only the net amount arriving in your bank account. CIS deductions go in the separate deductions field on your tax return. Monthly statements are the starting evidence, not this estimate.

How this CIS refund calculator works

Business profit is gross CIS income before deductions minus allowable business expenses. A loss is shown, but loss relief is not modelled.
Add entered non-savings taxable income to profit. Apply the selected year's Personal Allowance, taper and regional Income Tax bands using the same engine as our self-employed tax calculator.
Add Class 4 NI on business profit and optional voluntary Class 2. Subtract actual CIS credits and any other Income Tax already paid that you enter.
A negative balance is an estimated overpayment; a positive balance is estimated tax still due. Payments on account, HMRC account debts and credits not entered can change the final account.

Unlike the self-employed calculator's incremental business-tax display, this result includes Income Tax on all income entered and subtracts only actual entered tax-paid credits. We do not assume tax on a salary, pension or property profit has been collected. If PAYE tax is left blank, none is credited. The effective rate is total estimated Income Tax and modelled NI divided by business profit plus other taxable income; CIS withholding is not an extra tax.

National Insurance and pension assumptions

For 2026/27, Class 4 is 6% on profit above £12,570.00 up to £50,270.00, then 2% above. At profit of £7,105.00 or more, Class 2 is treated as paid without a charge. Below that, it is not automatically credited; optional voluntary contributions use 52 weeks at £3.65. Eligibility, age, part-year activity and gaps in your NI record need review. Selecting 2025/26 uses that year's own constants.

Pensions are gross personal relief-at-source contributions only, consistent with the existing tax engine. They reduce adjusted net income for the Personal Allowance taper and extend eligible tax bands; they do not reduce business profit for Class 4. Basic-rate provider relief is not a separate CIS cash refund. Pension eligibility, relevant earnings, annual allowance charges and carry-forward are not decided here.

Worked construction tax rebate examples

2026/27, England/Wales/NI, no other income, pension, voluntary Class 2 or additional credits. The actual CIS credits shown are example inputs, not a promise that every payment was deducted on its full gross amount. All results below come from the tested engine.

Annual tax compared with entered CIS credits
Gross income / expenses	Profit	Tax & NI	CIS credits	Estimated position
£25,000.00 / £5,000.00	£20,000.00	£1,931.80	£5,000.00	Refund £3,068.20
£45,000.00 / £6,000.00	£39,000.00	£6,871.80	£9,000.00	Refund £2,128.20
£80,000.00 / £10,000.00	£70,000.00	£18,088.60	£14,000.00	Still due £4,088.60

The contractor's CIS deduction base: a narrower set of costs

A cost can be allowable for your annual taxable profit without reducing the contractor's deduction base. HMRC's CIS340 sections 3.11–3.14 and Appendix D allow output VAT and qualifying direct costs attributable to the construction operations to be removed before applying the verified deduction rate.

Materials bought directly by you — actual cost, without profit or markup.
Consumable stores — actual cost, without profit or markup.
Non-travel fuel — actual cost, without profit or markup.
Plant hired from a third party — actual cost, without profit or markup.
Manufacture / prefabrication of materials — actual cost, without profit or markup.

Materials must have been paid for directly by the subcontractor receiving the payment. Contractor-supplied materials or materials another subcontractor bought cannot be claimed as your direct cost. Plant must be hired from a third party: owning plant does not justify a notional hire charge. Avoid counting the same cost in more than one category or payment.

Do not remove travelling expenses, fuel used for travelling, or subsistence, including accommodation, from the CIS deduction base. These remain in the payment even where a business expense may be allowable for annual profit.

If VAT registered, exclude input VAT from materials costs; if unregistered, include VAT you actually paid. Exclude output VAT actually charged from the payment. For a domestic reverse-charge invoice with no VAT charged by you, enter zero output VAT; the helper does not decide whether the reverse charge applies. Costs entered in the helper must already use the correct VAT basis.

For example, a VAT-registered subcontractor receiving £1,200.00 including £200.00 output VAT, with £300.00 qualifying costs excluding input VAT, has a deduction base of £700.00. At 20%, the estimated deduction is £140.00 and payment after CIS is £1,060.00.

Contractors should check and retain cost evidence. The shorter GOV.UK contractor guidance says to estimate materials costs if evidence is unavailable, but this is not permission to choose arbitrary percentages or inflate costs. Our helper expects attributable cost amounts and does not certify them.

Gross payment status, partnerships and limited companies

Only HMRC-authorised gross payment status permits payment without CIS deductions. Meeting a turnover test or simply registering for CIS does not authorise a zero rate. Income Tax and NI can still be due normally.

Partners report partnership income and deductions through the partnership return; each partner receives an allocated share of CIS credits to claim on their personal partnership pages. Our basic calculator does not allocate those amounts. Read HMRC's allocation guidance.

Limited companies follow a different route. They report CIS deductions suffered year-to-date through an Employer Payment Summary (EPS), alongside their normal payroll submissions, to offset PAYE and NI liabilities. Unused amounts can carry forward within the same tax year; remaining year-end credits follow HMRC's company refund procedure. Do not claim them on the Corporation Tax return. HMRC explains the company procedure here.

What to do next

Check every contractor's monthly payment-and-deduction statement against your records. Statements are due by the 19th after the relevant tax month ends.
Keep invoices, income records and expense evidence. Enter gross income and deductions separately on Self Assessment.
Complete the year's return to establish the ordinary annual liability. Any repayment remains subject to HMRC checks and other amounts on your account.
Review Making Tax Digital start dates using gross income, not net bank receipts or profit.

Do not wait for a projected refund before planning a bill. If the estimate shows tax due, your next-year payments on account may add to the cash required without changing this year's tax. In-year CIS repayment can be possible in specific circumstances, including cessation or qualifying ended accounting periods; check HMRC or an adviser rather than assuming it is always available.

Cases needing HMRC or professional review

This is a straightforward UK sole-trader model, not a complete tax return. Get advice for partnerships, companies, non-CIS trades, employment-status disputes, overseas/non-resident cases, part-year or retirement NI, combined employed/self-employed NI annual limits, loss relief, capital allowances, property finance-cost tax reductions, savings/dividends, student loans, benefits charges, unusual allowances or pension limits. Gross payment status and VAT reverse-charge eligibility are not determined here.

Updated CIS340 also contains rules outside the ordinary private sole-trader model: from 6 April 2026 payments to local-authority or public-body subcontractors are outside CIS. That is about the recipient, not a blanket exemption for private subcontractors working for public clients. Genuine statements and accurate claims remain essential; HMRC's 2026 anti-fraud powers are not alternative ordinary deduction rates.

Frequently asked CIS questions

How much CIS tax can I claim back?

Only an overpayment after reconciling your tax and National Insurance with CIS and other tax credits. Income, allowable expenses, other income and reliefs affect the result. A repayment is not guaranteed and HMRC may offset other amounts owed.

Why don't I get all my 20% CIS deductions back?

CIS deductions are advance payments towards tax and National Insurance, not a refundable fee. HMRC keeps the amount needed to settle your liability. Higher profits or other income can mean further tax is due even after 20% deductions.

Are CIS deductions 20%, 30% or 0%?

HMRC verification determines the payment status: 20% for registered subcontractors paid under deduction, 30% if unregistered or unverifiable, and 0% for authorised gross payment status. Gross payment status does not make profits tax free.

Do materials and VAT reduce CIS deductions?

Output VAT is excluded, along with permitted direct costs attributable to the work: materials bought directly by the subcontractor, consumable stores, non-travel fuel, third-party plant hire and manufacture or prefabrication of materials. Use actual costs without markup. Registered subcontractors exclude input VAT from materials costs; unregistered subcontractors include VAT paid.

Can I exclude travel and subsistence from the CIS deduction base?

No. Travelling expenses, travelling fuel and subsistence, including accommodation, remain in the contractor deduction base. Some business costs may be deductible for annual taxable profit even though they are not exclusions from CIS withholding.

Do I enter bank receipts or gross CIS pay?

Gross pay before CIS deductions, including the materials element, and excluding output VAT if VAT registered. Enter actual CIS deductions separately from your monthly payment-and-deduction statements. Net bank receipts alone understate income.

Can limited companies use this CIS refund calculator?

Not for the sole-trader annual refund result. Companies report CIS deductions suffered through payroll using an Employer Payment Summary, offset them against PAYE and NI, and follow HMRC's procedure for unused year-end credits. They must not claim CIS deductions through the Corporation Tax return.

How do partners claim CIS deductions?

The partnership reports gross income and CIS deductions through its return and allocates deductions to partners. Individual partners claim their allocated share on their own Self Assessment partnership pages. This tool does not allocate partnership turnover, profits or credits.

What evidence do I need for a CIS repayment?

Keep monthly contractor payment-and-deduction statements, income records and business-cost evidence. Contractors must provide deduction statements by the 19th after the relevant tax month ends. The calculator cannot verify that credits were paid to HMRC or submit a repayment claim.

Is 2026/27 a final refund estimate?

During the tax year it is a forecast: enter full-year expected income and costs together with expected full-year deductions, or use an ended tax year with complete records. Do not mix annual forecasts with only a few months of deductions and treat the result as a final bill.

Official sources and review

Substantive CIS rules checked against current official guidance on 23 October 2026. CIS340 was last updated 27 August 2026. Tax bands and NI are shared with the existing tested SoloCalc engine.

Your annual figures

Your CIS estimate