CIS Explained for Gas Engineers: Rates, Registration and Which Jobs Count
- 1. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 2. What is the Construction Industry Scheme?
- 3. Does CIS apply to gas engineers?
- 4. Who you’re working for
- 5. What the work is
- 6. CIS rates: 20%, 30% and 0%
- 7. How CIS deductions work on an invoice
- 8. How to add CIS to an invoice in Gas Engineer Software
- 9. CIS and the domestic reverse charge
- 10. How to register for CIS as a subcontractor
- 11. Gross payment status: is it worth applying for?
- 12. Getting your CIS deductions back
- 13. When you become the contractor
- 14. What changed in April 2026
- 15. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 16. Sources
- 1. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 2. What is the Construction Industry Scheme?
- 3. Does CIS apply to gas engineers?
- 4. Who you’re working for
- 5. What the work is
- 6. CIS rates: 20%, 30% and 0%
- 7. How CIS deductions work on an invoice
- 8. How to add CIS to an invoice in Gas Engineer Software
- 9. CIS and the domestic reverse charge
- 10. How to register for CIS as a subcontractor
- 11. Gross payment status: is it worth applying for?
- 12. Getting your CIS deductions back
- 13. When you become the contractor
- 14. What changed in April 2026
- 15. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 16. Sources
The Construction Industry Scheme (CIS) is an HMRC scheme where contractors take tax off a subcontractor’s payment and pay it to HMRC on their behalf. For gas engineers, it only applies to some jobs, and most day-to-day work falls outside it. This guide covers which jobs count, the deduction rates, how to register and how to get the money back.
- 1. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 2. What is the Construction Industry Scheme?
- 3. Does CIS apply to gas engineers?
- 4. Who you’re working for
- 5. What the work is
- 6. CIS rates: 20%, 30% and 0%
- 7. How CIS deductions work on an invoice
- 8. How to add CIS to an invoice in Gas Engineer Software
- 9. CIS and the domestic reverse charge
- 10. How to register for CIS as a subcontractor
- 11. Gross payment status: is it worth applying for?
- 12. Getting your CIS deductions back
- 13. When you become the contractor
- 14. What changed in April 2026
- 15. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 16. Sources
- 1. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 2. What is the Construction Industry Scheme?
- 3. Does CIS apply to gas engineers?
- 4. Who you’re working for
- 5. What the work is
- 6. CIS rates: 20%, 30% and 0%
- 7. How CIS deductions work on an invoice
- 8. How to add CIS to an invoice in Gas Engineer Software
- 9. CIS and the domestic reverse charge
- 10. How to register for CIS as a subcontractor
- 11. Gross payment status: is it worth applying for?
- 12. Getting your CIS deductions back
- 13. When you become the contractor
- 14. What changed in April 2026
- 15. Invoice CIS and reverse charge jobs with Gas Engineer Software
- 16. Sources
Invoice CIS and reverse charge jobs with Gas Engineer Software
Professional and easy invoices, quotes and estimates. Syncs with Xero, QuickBooks and Sage.
Try it free for 14 days →What is the Construction Industry Scheme?
Under CIS, a contractor who pays you for construction work deducts a percentage of your labour and sends it to HMRC. You receive the rest.
The deduction isn’t an extra tax. It’s an advance payment towards your own Income Tax and National Insurance, and it’s taken off your bill at the end of the year.
Does CIS apply to gas engineers?
It depends on two things: who you’re working for and what the work is.
Who you’re working for
CIS only applies when you’re paid by a contractor. That includes builders, developers, housebuilders, other trade businesses that subcontract work to you, and other deemed contractors.
Private householders are never contractors. Any job you do directly for a homeowner is outside CIS, whatever the work.
That changes when a builder or other contractor is doing the work for the homeowner and subcontracts part of it to you. If your part is installation work, it’s inside CIS, and the contractor has to deduct from your payments.
What the work is
Appendix C.3 of HMRC’s guide to the CIS (known as CIS 340) has the full list of what is and isn’t inside the scheme. The ones most relevant to heating and plumbing are:
| Installing heating systems | Inside CIS |
| Installing water supply, drainage and sanitation | Inside CIS |
| Installing gas mains and pipelines | Inside CIS |
| Kitchen and bathroom installation and repair | Inside CIS |
| Servicing heating systems | Outside CIS |
| Repairs and maintenance of heating, water and drainage systems | Outside CIS |
| Replacing single parts, such as taps or a radiator | Outside CIS |
| Manufacturing or delivering heating systems or components | Outside CIS |
In practice, a gas engineer working through a builder on a new build or a full heating install is inside CIS. Servicing, breakdowns and parts swaps for a contractor are outside it, as long as they aren’t part of a contract that also includes installation work.
CIS rates: 20%, 30% and 0%
The rate depends on your registration status:
| Your status | Deduction |
|---|---|
| Registered for CIS | 20% |
| Gross payment status | 0% |
| Not registered | 30% |
If you do CIS work and haven’t registered, the contractor has to take 30%. Registering is the simplest way to keep more of each payment.
Gross payment status is a separate status you apply to HMRC for. Once you have it, contractors pay your invoices in full with nothing deducted, and you pay your tax and National Insurance yourself through Self Assessment or your company’s normal tax returns. You have to pass a turnover test to get it, which is covered in the gross payment status section below.
How CIS deductions work on an invoice
The deduction only applies to the part of the payment that isn’t materials. The contractor doesn’t deduct anything from materials you’ve bought for the job, VAT, and consumables.
Travel and subsistence costs are included, so they do have the deduction taken off.
Here’s a worked example for a CIS-registered subcontractor charging VAT at the standard rate:
| Line | Amount |
|---|---|
| Labour | £1,000 |
| Materials | £500 |
| Subtotal | £1,500 |
| VAT at 20% (on the full £1,500) | £300 |
| Invoice total | £1,800 |
| CIS deduction (20% of the £1,000 labour) | £200 taken off |
| Amount you're paid | £1,600 |
VAT is worked out on the full subtotal, before the CIS deduction. If the domestic reverse charge applies, you don’t add VAT at all, so you’d be paid £1,300 and the contractor accounts for the VAT (see below).
The £200 goes to HMRC against your tax bill. Your contractor should send you a deduction statement each month showing what they’ve taken. Keep every one, because you’ll need them to claim the money back.
How to add CIS to an invoice in Gas Engineer Software
Gas Engineer Software makes it easy and clear to add CIS deductions on your invoices. It’s included on a separate line on the invoice, so the contractor and your accountant can see exactly what’s been taken off.
- Step 1: Create a new invoice on the web portal or the app.
- Step 2: On the web portal, click “Add CIS Line Item”. On the app, tap the cog in the top right, then “Add CIS Deduction”.
- Step 3: Enter the details. Apply CIS to the labour only, not materials.
- Step 4: The invoice now shows a separate line tagged “CIS Deduction”, and the deduction appears in the invoice breakdown.
If the domestic reverse charge applies, switch on the “Domestic Reverse Charge” toggle on the same invoice (on the app, it’s a checkbox under the cog). The VAT is then left out of the grand total. The toggle also works on quotes and estimates, and carries across when you convert them to an invoice.
Above: An invoice in GES with the CIS deduction added as a separate line item.
CIS and the domestic reverse charge
If you and the contractor are both VAT registered, the domestic reverse charge usually applies to CIS work. You don’t charge VAT on the invoice. The contractor accounts for it with HMRC instead.
How to register for CIS as a subcontractor
You need to register if you’re a sole trader, a partner in a partnership or the owner of a limited company doing CIS work. Employees don’t register.
You register with HMRC on GOV.UK, either online or with the postal form for your business type. You’ll usually need:
- your legal business name, and trading name if different
- your Unique Taxpayer Reference (UTR)
- your VAT number, if you’re VAT registered
- the date you started trading
- your National Insurance number or Company Registration Number, depending on your business type
Gross payment status: is it worth applying for?
With gross payment status, contractors pay you in full and nothing is held back until the end of the year, which helps your cash flow.
To qualify, HMRC’s turnover test says your construction turnover over the last 12 months (excluding VAT and materials) has to be at least:
| Business type | Minimum turnover |
|---|---|
| Sole trader | £30,000 |
| Partnership, per partner | £30,000 |
| Partnership, whole business | £100,000 |
| Limited company, per director | £30,000 |
| Limited company, whole business | £100,000 |
A company controlled by five people or fewer needs £30,000 for each of them. You also need a record of paying your tax and National Insurance on time, and your business has to do construction work in the UK and run through a bank account.
If most of your work is servicing and repairs for homeowners, your CIS turnover may not reach the threshold, and gross status won’t make much difference to you anyway.
Getting your CIS deductions back
How you reclaim depends on how you trade: Sole trader or limited company.
Sole traders enter the full invoice amounts as income on their Self Assessment return and the deductions in the CIS box. HMRC takes the deductions off your tax and National Insurance bill, and refunds anything you’ve overpaid.
Limited companies reclaim through the company’s monthly payroll, by reporting the deductions on the Employer Payment Summary. They’re offset against what the company owes in PAYE and National Insurance. Don’t claim them through the Corporation Tax return, because HMRC can issue a penalty if you do.
For more on what’s due and when, see our tax guide for heating and plumbing companies.
When you become the contractor
If you pay other engineers or subbies to carry out CIS work for you, you’re a contractor under the scheme as well. That means you have to:
- register as a contractor with HMRC
- verify each subcontractor with HMRC before you pay them, so you know which rate to deduct
- file a monthly return of what you’ve paid and deducted
- give each subcontractor a statement of their deductions
Taking on help is covered in more detail in our guide to hiring your first engineer.
What changed in April 2026
Two changes from 6 April 2026 are confirmed in sections 2.11 and 4.18 of HMRC’s CIS guide:
- payments to subcontractors that are local authorities or public bodies are now outside CIS
- mainstream contractors have to file a nil return again for any month with no subcontractor payments
Invoice CIS and reverse charge jobs with Gas Engineer Software
Professional and easy invoices, quotes and estimates. Syncs with Xero, QuickBooks and Sage.
Try it free for 14 days →Sources
- HMRC, Construction Industry Scheme: a guide for contractors and subcontractors (CIS 340): sections 2.2, 2.11, 2.17, 3.12 and 4.18, and Appendix C
- GOV.UK, What you must do as a CIS subcontractor
- GOV.UK, CIS gross payment status
- GOV.UK, How to register for CIS