Turn on CIS in QuickBooks Online

Contractors using CIS (Construction Industry Scheme) are responsible for calculating and deducting money from a subcontractor’s payments which then go to HMRC as part of the subcontractor’s tax and National Insurance obligations. 

By turning on this feature, QuickBooks will calculate your CIS deductions, track CIS withheld or suffered amounts and create the necessary reports for HMRC.

Turn on CIS

1. Select the gear icon and select Account and settings (or Company Settings depending on what you see).
2. Select Advanced.
3. Select Construction Industry Scheme (CIS).
4. Select the pencil ✏️ icon.
5. Turn on the Enable CIS switch.
6. Enter your UTR (Unique Taxpayer Reference) number. This is your company tax number.
7. Enter your Employer’s PAYE and Accounts Office reference number.
8. If you’re a CIS subcontractor, tick the I am a CIS subcontractor and choose your CIS rate from the dropdown. We need this to calculate your CIS suffered. You'll get this from HMRC when you register for CIS.
9. Select Save and then Done.

What happens when I turn on CIS?

You can't switch CIS off once it's turned on in QuickBooks. But you can stop using it anytime you like, and we keep the accounts and reports around so your records are straight. Once you turn on CIS:

• We create the CIS accounts you need to track CIS.
• You’ll see the CIS centre under Taxes.
• We’ll start asking you for more information about your contractors and subcontractors.
• We'll track your CIS deductions as you create CIS transactions.
• We add CIS reports and statements.

Notes:

• CIS is calculated using the cash method. This is the same for QuickBooks accounts that are set to use the accrual method.
• CIS will only calculate when a payment is made. 
• CIS will start tracking from the month it is switched on. For example, if you turn on CIS at the beginning of November then the first return that can be submitted in QuickBooks is at the end of November.
• You can't add and submit previous CIS returns in QuickBooks. You’ll need to submit any previous returns via the HMRC website.

Next, it's time to add contractors and subcontractors.

Check out the CIS guide for more help.