CIS for plant hire —
the machine element
The rule most plant hire businesses get wrong, and the one that costs the most to correct after the fact.
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The machine element is excluded
On self-drive plant hire the machine element is not subject to CIS deduction. Only the labour element is. If you invoice operated hire as a single line, the whole amount may be treated as labour and deducted at 20% or 30%.
Split the invoice. Plant on one line, labour on another. The deduction applies to the labour line only.
20% or 30%
Verified subcontractors are deducted at 20%. Unverified at 30%. Verification is done through HMRC and takes minutes — an unverified subbie costs them an extra 10% unnecessarily.
Subcontractors with gross payment status have no deduction at all. Worth checking before assuming.
The 19th deadline
CIS deducted in a tax month must reach HMRC by the 19th of the following month. A monthly return is required even where there is nothing to report — a nil return still has to be filed.
Ireland
CIS is a UK scheme and does not apply in the Republic of Ireland. Irish accounts in PAI run without the CIS elements, with EUR pricing and Irish VAT number formats.
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