CIS tax refund: how UK subcontractors claim money back

Sole traders and partners: the Self Assessment return

At the end of the tax year, HMRC says you send your Self Assessment tax return as usual. You record:

• your total pay before deductions were taken, as income
• the total deductions contractors have taken, as CIS deductions

HMRC works out the tax and takes off the deductions the contractors took. If you still owe tax after that, you pay it by 31 January following the end of the tax year. For the year that ran from 6 April 2025 to 5 April 2026, the deadlines page (opens in a new tab) puts that payment at 11:59pm on 31 January 2027. The deadline guide sets the filing dates out. If you are due a tax refund, HMRC will pay the money back. The subcontractor page does not say how many weeks that takes, so I am not going to invent a wait.

That 31 January bill can also include a payment on account. CIS deductions and payments on account are not the same thing. How the January and July payments are worked out is in the payments on account guide.

If you stop trading during the year

The same HMRC page says that if you stop trading, you may be able to get a refund of deductions you have already paid this tax year. You use the sole trader or partner form.

Form CIS40 (opens in a new tab) is the individual's claim for repayment of subcontractor deductions during the current tax year. HMRC says a self-employed subcontractor uses that form for deductions in the current tax year, and uses the tax return instead if the claim is after the tax year has ended. You can claim online, or fill the form in on screen, print it, and post it. You need to sign in. The online form gives a reference number you can use to track it. That publication was last updated on 6 April 2023. Use the form on the page, not an old PDF you saved from a previous year.

Form CIS41 (opens in a new tab) is the partner's claim, again for the current tax year, and it says the same thing about using the tax return after the year has ended. The page says you need your National Insurance number, the partnership tax reference, each partner's tax reference, and the bank details for the repayment. It was also last updated on 6 April 2023.

The subcontractor page mentions that in-year form under "if you stop trading". The CIS40 and CIS41 pages describe a claim during the current tax year, and point you to the return once the year has ended. Read both pages before you send a form. If you are still trading and the year has not ended, the usual route on the subcontractor page is the return at the end of the year.

HMRC's page on stopping self-employment (opens in a new tab) says you must tell HMRC, and you must send a final tax return. If you are registered for CIS and you stop trading as a contractor or a subcontractor, that page says call the CIS helpline as soon as possible.

Do not put your UTR, your National Insurance number, or a bank account into a chat. A tax year, the gross pay, and the deduction total from the statements are enough to draft a sentence. The claim itself goes to HMRC.

Limited companies: payroll first, not the Corporation Tax return

A limited company uses its payroll scheme. HMRC's steps on the subcontractor page are:

1. Send your Full Payment Submission (FPS) as usual.
2. At the same time, send an Employer Payment Summary (EPS). Enter the total CIS deductions for the year to date.
3. HMRC takes the CIS deductions off what you owe. Pay the balance by the usual date.

If deductions are left after you have paid your tax, you can carry them forward into the next period, as long as it is still the same tax year. Tell HMRC on the EPS that you have nothing to pay.

If deductions are left after the end of the tax year, claim a refund.

HMRC says do not use the Corporation Tax return to pay tax with these deductions. You may get a penalty if you do.

The company keeps a record of the CIS deductions it has used to pay its monthly or quarterly PAYE bill. HMRC says you can use form CIS132 for that record. Keep the monthly payment and deduction statements as well.

If HMRC thinks the claim is wrong, they may ask for evidence of the deductions or ask you to change the claim. If you do not do that by the deadline they give you, HMRC will change the claim from the information they have, and you will not be able to make any more claims in that tax year. You can appeal. HMRC says they will tell you how.

If you liquidate the company or it goes into administration, the same page says you can claim a refund of deductions taken that tax year.

How a limited company claims the refund

HMRC's limited company refund guidance (opens in a new tab), updated on 25 August 2026, is the claim itself. CIS deductions are advance payments towards the company's tax. If more was deducted than the company needs to pay in tax, you make a claim.

After you claim, HMRC uses the deductions to pay any overdue PAYE or Corporation Tax. If money is left, you can take a refund, or use it to pay VAT or upcoming Corporation Tax bills.

You must be a limited company subcontractor, or an agent for one, and you must have had more CIS deducted than the tax you need to pay.

You claim for a tax year once it has ended. A tax year runs from 6 April to 5 April. For the past 6 tax years you can claim online or by post. For earlier years you claim by post. You need to have submitted all of these:

• Full Payment Submissions and Employer Payment Summaries
• monthly CIS returns, if you are also a contractor
• Company Tax returns

The overpayment you tell them is the total CIS deductions taken, minus the total tax paid using those deductions. HMRC says to use the monthly statements, the FPS and EPS records, and the monthly CIS returns if you are also a contractor. If you are not sure, the page says give an estimate.

You also need the company name, telephone number and address, the PAYE reference, and the Corporation Tax unique tax reference. If you want the refund in a bank or building society account, you give the bank name, account number, sort code, and the account holder's name. If you want it paid to an agent or a nominated person, the claim needs a completed form R38 or a signed authority. Do not paste those references or the bank details into a chat.

HMRC checks your figures against what the contractor sent. If they do not match, HMRC asks for copies of the payment and deduction statements and the bank statements. If you already know they do not match, you can include the copies with the claim.

To use the deductions against an upcoming Corporation Tax bill, you tell HMRC which accounting period. To use them against VAT, you give the VAT registration number and how much VAT you want to pay.

A claim before the tax year ends

HMRC says you can only claim a refund for the current tax year, before it has ended, if either the business has stopped trading, or you have had deductions taken after changing to gross payment status. The claim has to include copies of all the payment and deduction statements and bank statements you have received this tax year.

Online, by post, and what happens next

Online, you use the sign-in details linked to the company's Corporation Tax and PAYE accounts. An agent uses their agent services account.

By post, you send a letter asking for a CIS repayment, with the information the page lists, and you write "CIS" on the envelope. The address on that page is PT Operations North East England, HM Revenue and Customs, BX9 1BX, United Kingdom.

HMRC then checks that your information matches theirs and the contractor's, and whether overdue tax has to be paid first. If the claim is incomplete or does not match, they may ask for more. The page says they will usually respond within 8 weeks. That 8 weeks is this limited-company claim. I am not applying it to a sole trader refund, because the sole trader page does not state it.

If HMRC contacts you about a tax debt you plan to pay with the CIS deductions, the page says they may be able to pause the debt. You contact Employers: general enquiries and explain the situation.

To change a claim, you use the online form again with the correct details. By post, you send a letter asking to change the CIS repayment claim, write "CIS" on the envelope, and include the new overpayment amount and details of the previous claim.

What to keep

A sole trader or partner keeps Self Assessment records for at least 5 years after the 31 January submission deadline of the relevant tax year. HMRC's records page (opens in a new tab) gives the example of a 2022 to 2023 return sent by 31 January 2024, kept until at least the end of January 2029. On that rule, a 2025 to 2026 return filed by 31 January 2027 is kept until at least the end of January 2032. Very late returns, sent more than 4 years after the deadline, are kept for 15 months after you send them.

A limited company is a different rule. HMRC's company records page (opens in a new tab) says you keep records for 6 years from the end of the last company financial year they relate to, or longer in the cases that page lists. The 5-year Self Assessment line is not the company line. The page also says you can be fined £3,000 by HMRC, or disqualified as a director, if you do not keep accounting records.

The statements are the evidence. A guessed deduction is not a claim.

Explain this CIS refund position in plain English. UK English. Use only the figures I type. Do not change a number. Do not say I am due a refund unless the two totals show deductions higher than the tax. Do not include a UTR, a National Insurance number, a PAYE reference, or a bank account. If a figure is missing, write MISSING.

Sole trader, partner, or limited company:
Tax year:
Pay before deductions, from the statements:
CIS deductions, from the statements:
Tax the calculation says I owe before those deductions:
Route I am using: Self Assessment return, CIS40, CIS41, or limited company refund claim:

Work the two totals yourself before you accept the explanation. The deductions guide is where the percentage came from. This page is only how the money comes back. If the position is awkward, ask an accountant. The checklist covers the sole trader return. The weekly email is the place I flag the next HMRC date.