Understanding CIS Accounting: What Construction Businesses in Salford Need to Know

Construction businesses across the UK operate under a unique set of financial and tax obligations. Nowhere is this more evident than with the Construction Industry Scheme (CIS), a framework introduced by HMRC to ensure tax compliance within the sector. For construction firms in Swinton and Salford, understanding how CIS accounting works—and how a specialist construction accountant can help—is critical to staying compliant, profitable and competitive.

The Construction Industry Scheme (CIS) is a tax deduction scheme set up by HMRC for contractors and subcontractors in the construction sector. Under CIS, contractors must deduct money from a subcontractor’s payments and pass it directly to HMRC. These deductions count as advance payments towards the subcontractor’s tax and National Insurance liabilities.

This scheme applies to all construction work carried out in the UK, including site preparation, building, decorating, and demolition. Businesses must register as either contractors or subcontractors depending on their role in the supply chain. Failure to register properly can result in higher tax deductions and penalties.

For further details on registering and complying with CIS, visit HMRC’s official guidance on the Construction Industry Scheme.

While general accounting services can assist with bookkeeping and tax returns, construction companies benefit most from accountants who understand the specific nuances of the industry and CIS. At Co-gency Chartered Accountants, we provide tailored services to construction businesses in Swinton and Salford, ensuring every aspect of CIS compliance is managed accurately and efficiently.

Key benefits of working with a CIS specialist accountant include:

• Accurate deduction tracking: Ensuring all deductions made by or from subcontractors are correctly recorded and reported.
• Timely filing: Avoiding penalties by submitting monthly CIS returns accurately and on time.
• Subcontractor verification: Managing the process of checking subcontractor registration status with HMRC.
• Reduced tax risk: Helping subcontractors reclaim overpaid tax or understand their tax position through accurate, compliant submissions.
• Payroll and VAT integration: Ensuring CIS deductions are reconciled with PAYE and VAT obligations.

Even experienced construction firms can face difficulties navigating CIS requirements. Common issues include:

• Misclassification of subcontractors and employees can lead to compliance breaches.
• Late or incorrect monthly filings, resulting in fines.
• Inaccurate record keeping, affecting year-end tax returns and HMRC audits.
• Difficulty reclaiming tax, especially for subcontractors who are not registered under gross payment status.

By partnering with a professional CIS accountant, construction firms can mitigate these risks and operate with confidence.

Modern accounting software offers powerful tools for automating and streamlining CIS compliance. HMRC’s CIS Online service enables contractors to file returns, verify subcontractors, and manage deductions digitally.

At Co-gency, we help clients integrate CIS Online systems with their broader financial infrastructure, ensuring smooth workflows and reducing the administrative burden. With cloud-based platforms and digital filing, businesses can save time and avoid human error.

Our construction sector expertise sets us apart. Based in Swinton and serving businesses across Salford, we understand the local market conditions, regulatory expectations, and financial pressures facing construction firms.

We provide:

• Personalised tax planning for contractors and subcontractors.
• Advice on structuring your business for tax efficiency under CIS.
• Support payroll, VAT, and general bookkeeping in construction contexts.
• Liaison with HMRC to handle disputes or claims.

Whether you’re a sole trader, partnership, or limited company, Co-gency Chartered Accountants can help you remain compliant and focused on your core operations.

The Construction Industry Scheme adds a layer of complexity to accounting in an already fast-moving sector. For construction firms in Swinton and Salford, working with an experienced CIS accountant is no longer optional—it’s essential. At Co-gency, we bring industry-specific insight and HMRC expertise to help your business succeed with clarity and confidence.

For professional support with CIS accounting, contact us today at Co-gency Chartered Accountants.