CIS Invoices on WhatsApp: The UK Subcontractor's Guide

What Is the Construction Industry Scheme?

The Construction Industry Scheme (CIS) is an HMRC scheme that affects how subcontractors in the UK construction industry get paid. If you work as a subcontractor for a contractor — a builder, main contractor, or construction company — the contractor is required to deduct tax from your payment before they pay you and send that deduction directly to HMRC on your behalf.

The standard CIS deduction rate is 20% for registered subcontractors, or 30% for those who haven't registered. The deduction applies only to the labour element of your invoice — not to materials.

This matters for your invoice because your contractor needs to see a clear breakdown of labour and materials to calculate the correct deduction. An invoice that just shows a single total gives them nothing to work with — and some contractors will refuse to pay until you send a corrected one.

How the CIS Deduction Calculation Works

The maths is straightforward once you understand the structure. Here's a worked example for a subcontractor who's completed a week's groundworks for a contractor:

The contractor pays you £1,340. They send the £240 deduction to HMRC on your behalf. At the end of the tax year, that £240 counts as tax you've already paid — it's offset against your Self Assessment bill, or refunded if you've overpaid.

What a CIS Invoice Must Include

A valid CIS invoice needs to contain specific information so your contractor can process it correctly and report to HMRC. Missing any of these can result in payment delays:

• Your business name and address
• Your Unique Taxpayer Reference (UTR) number
• Your National Insurance number (for sole traders)
• Your CIS registration status
• The contractor's business name and address
• Invoice number and date
• Description of work carried out and the period it covers
• Labour costs separated clearly from materials costs
• The gross total (labour + materials)
• The CIS deduction amount (clearly shown as a deduction)
• The net amount payable (what you actually receive)

If you're VAT-registered, you also need to include your VAT number and the VAT calculated on your labour and materials — though CIS deduction is calculated on the net amounts before VAT.

CIS and VAT: The Combination That Trips People Up

If you're VAT-registered and working under CIS, your invoice needs to handle both correctly. The order of calculation matters:

The contractor pays VAT in full — the CIS deduction applies only to the net labour element, not the VAT. The contractor then claims the VAT back through their own VAT return in the usual way.

Sending a CIS Invoice from WhatsApp

Generating all of this correctly every time — separating labour from materials, calculating the 20% deduction, formatting the document so your contractor can actually use it — is where the manual approach falls apart. Most subcontractors either use a spreadsheet template they maintain themselves, or ask their accountant to do it, or just send an informal message and hope the contractor sorts it out.

TaskDrop handles CIS automatically. When you start an INVOICE conversation and indicate you're working under CIS, it asks for your labour and materials separately, calculates the deduction, and produces a correctly formatted PDF — from WhatsApp, without a spreadsheet in sight.

CIS Deduction Rates: 20% vs 30%

The deduction rate depends on whether you're registered under CIS and verified by your contractor:

If you're being deducted at 30%, the single most valuable thing you can do for your cash flow is register under CIS. Registration is free and takes minutes through GOV.UK. Once registered and verified by your contractor, the rate drops to 20% immediately.

Gross Payment Status — where no deduction is made at all — is available to established subcontractors with a good compliance record, typically requiring at least £30,000 in annual CIS turnover. If you've been working under CIS for a few years, it's worth checking whether you qualify.

Claiming Back CIS Deductions

The deductions your contractors make aren't lost money — they're advance tax payments. At the end of the tax year, when you submit your Self Assessment return, all CIS deductions made during the year are counted as tax already paid.

If the deductions exceed your actual tax bill — which is common for subcontractors with high materials costs or low profits — HMRC will refund the difference. To claim this accurately, you need records of every CIS deduction made, which should appear on the payment and deduction statements your contractors send you monthly.

CIS and Making Tax Digital

From April 2026, sole traders earning over £50,000 — including subcontractors — need to keep digital income records and submit quarterly summaries to HMRC. If your CIS invoices are still on paper, word documents, or informal WhatsApp messages, you're not keeping digital records in the way HMRC now requires.

Every CIS invoice generated through TaskDrop is numbered, dated, and stored in your dashboard — contributing automatically to your digital income record. At the end of each quarter, you can download a CSV of all invoices to send to your accountant or bridging software.

The Bottom Line for Subcontractors

CIS invoicing is one of the more tedious parts of working as a subcontractor in the UK. The calculation isn't difficult, but getting the document right every time — with the correct labour/materials split, correct deduction, correct UTR, and all the required details — takes time and attention to detail that's hard to maintain when you've just finished a week on site.

Getting it wrong costs you money. An invoice with the deduction calculated on the total instead of just labour means you're underpaid. A missing UTR means your contractor can't verify you and may deduct at 30%. A document your contractor can't use means payment delays while they wait for a corrected version.

Automating it from WhatsApp removes all of that friction — and costs less than a single hour of your time per year.