What CIS deduction rate should I apply when paying a subcontractor?
I'm about to pay a subcontractor for the first time under CIS and don't know what percentage to withhold.
Asked by Anonymous on 18 October 2025
1 Answer
The standard CIS deduction is 20% for subcontractors registered with HMRC under CIS, rising to 30% if a subcontractor is not registered or you're unable to verify them with HMRC, and dropping to 0% for subcontractors who hold gross payment status. You must verify each new subcontractor with HMRC before your first payment to them so the system tells you the correct rate to apply. Getting the rate wrong, or failing to verify, can lead to penalties, so it's worth running this through CIS-compliant payroll or accounting software.