Under the scheme, contractors deduct money from a subcontractor’s payment and pass it to HM Revenue and Customs (HMRC). It applies to self-employed workers and businesses in the Construction Industry.
Contractor : Engaging other self-employed workers to do construction work, or you spend more than £1 million a year on construction. Then click here to know more about how to register as contractor.
Subcontractor : You are paid by a building contractor for doing work. Click here to see how to register as contractor.
Under the scheme, contractors need to check whether workers are registered with HMRC. They will need your Unique Taxpayer Reference (UTR) and National Insurance number to do this.
For subcontractor, payments you received maybe subject to ta deductions, which is 20% for registered subcontractor and 30% for subcontractors without registered the scheme or not verified .
If you want to know more about the scheme, you can call CIS helpline 0300 200 3210 or watch this video made by HMRC.