My Job Goblin

Free tool

CIS deduction calculator for subcontractors

Your statement says they took a number off. This works out whether that number is right, and what it should have been.

No signup. Rules from HMRC CIS340, read 22 August 2026.

Work out the deduction

Fill in the invoice as you sent it and the materials as you bought them. The figures update as you type, and nothing is stored or sent anywhere.

Your invoice

The whole job before VAT, and before anything was taken off.

Enter the invoice value in pounds, excluding VAT.

What they cost you, on the supplier’s receipt. Not what you charged for them.

Your CIS rate

What should have happened

Materials come out first− £600.00
Labour the deduction applies to£1,800.00

Deduction at 20%

£360.00

You should be paid, before VAT£2,040.00

If they deducted from the whole invoice

They would have taken £480.00, which is £120.00 more than they should. That is the most common CIS error on a statement, and it is your money.

VAT never forms part of a CIS calculation, so every figure here is before VAT. This checks a statement you have been given. It is not a filing figure: what counts against your record is what the contractor reports to HMRC on their monthly return.

Materials come out first

This is where nearly every disputed statement goes wrong, in one of two directions. The contractor runs the percentage over the whole invoice and takes too much, or the subcontractor uses the marked-up materials figure and expects a smaller deduction than the rule gives.

Buy materials for £500, invoice them at £650 after a handling markup, and only £500 comes out of the base. The £150 of markup is labour income, and the deduction applies to it.

  • Materials you bought for the job, at the supplier's price
  • Consumable stores actually used on the job
  • Plant you hired in, and the fuel for it
  • Your markup on those materials, which is labour income
  • Plant you already own, which is not hire
  • Labour you bought from another subcontractor
  • VAT, which sits outside the calculation entirely

What to do if it is wrong

A contractor must give you a written payment and deduction statement within 14 days of the end of each tax month, and a tax month runs from the sixth of one month to the fifth of the next. That statement is not a courtesy, it is the evidence you use to reclaim the tax.

If the deduction is larger than the figure above, ask in writing and say which part of the invoice was materials. Most of the time it is an honest mistake in a spreadsheet. If the statement never arrives at all, write to HMRC with your details, the contractor’s details and the dates and amounts, and HMRC can set the deductions against your bill without the paperwork.

It works this out on every invoice you send

My Job Goblin holds what you paid for materials and what you charged for them separately, so the deduction is calculated from the right one without you having to remember which.

Start free, no card neededRead the full guide

General information about the Construction Industry Scheme, not tax advice, and not a filing figure. Rules summarised from HMRC’s CIS340 guidance read on 22 August 2026. What counts against your record is what the contractor reports on their monthly return. For your own circumstances, speak to an accountant.

Frequently asked questions

Is the CIS deduction taken from the whole invoice?

No, and this is the single most common error on a statement. The deduction applies to labour only. Before the percentage is applied, the contractor takes out what you actually paid for materials, consumable stores, plant hire and fuel. On a £2,400 invoice with £600 of materials, a 20% deduction is £360, not £480. If your statement shows the higher figure, the contractor has run the percentage over the whole invoice and is holding £120 of your money that should have reached your bank.

Do I use what I paid for materials or what I charged?

What you paid, on the supplier's receipt. If you bought materials for £500 and invoiced them at £650 after a handling markup, only £500 comes out of the base. The £150 of markup is labour income and the deduction applies to it. Using the charged figure takes too much out of the base and under-deducts, which looks like good news until the contractor's statement and your invoice disagree.

Does VAT come into the CIS calculation?

Never. CIS is worked out on the VAT-exclusive value of the invoice. If the VAT domestic reverse charge applies to the job then there is no VAT on the invoice at all, and if the customer is an end user there may be, but either way the VAT sits outside the CIS sum entirely.

Why is my rate 30% instead of 20%?

Because the contractor could not verify you with HMRC, usually because you are not registered for CIS. Nothing else about the job changes and you are not in trouble, but you are lending HMRC an extra ten percent of your labour until you file your return. Registering is free and is the cheapest thing most subcontractors can do for their cash flow.

Is this figure what I file?

No. This tells you whether the statement you were handed looks right, which is a different question. What counts against your record is what the contractor reports to HMRC on their monthly return, and what you enter on your Self Assessment comes from the statements they give you. Use this to spot a statement worth querying, then query it.