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Part 5 of 7 · CIS deduction checker series ~5 min read

Closing the tax month by the nineteenth

Nothing in a CIS month is complicated on its own. What makes it go wrong is that three things are built from what ought to be the same numbers — the return, a statement for every subcontractor, and a payment — and in most offices they are built on different days from a ledger that kept moving.

Key takeaways

  • Tax months run from the 6th to the 5th. The return is due by the 19th.
  • Statements go to subcontractors within 14 days of the end of the tax month.
  • Deductions are paid by the 22nd electronically, or by the 19th otherwise.
  • From 6 April 2026 a month with no payments needs a nil return, unless HMRC was told in advance.
  • Keep the records for at least three years after the end of the tax year they relate to.

From the 5th to the 22nd

Closing a CIS tax month from freeze to statementsA vertical chain inside an AWS account container, entered from a box on the left labelled Month ends, on the 5th of every month. Freeze the month pins payments, bases and verifications. Check verification confirms every payee has a record in date, with a side exit reading missing: Stop the close, because a payment has no verification. Any payments asks whether there was one or more in the tax month, with a side exit reading none: Nil return, unless HMRC was told in advance. Build the return covers payments, materials and deductions. Statements and pack produces one statement per subcontractor, plus the evidence. A note says the return, the statements and the payment are three views of one frozen table, and that built on different days they differ by the invoices in between.AWS ACCOUNTMonth endson the 5th,every monthFreeze the monthpayments, bases andverifications pinnedCheck verificationevery payee has arecord in dateStop the closea payment with noverificationmissingAny payments?one or more inthe tax monthNil returnunless HMRC wastold in advancenoneBuild the returnpayments, materials,deductionsStatements and packone per subcontractor,plus the evidenceReturn, statements and payment are three views of one frozen table. Built on different days, they differ by the invoices in between.
Fig 1. Five steps and two exits. The first exit stops the month; the second is the one that became a requirement again in April 2026.
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Three deadlines that look like one

The return for the tax month ending 5 September has to reach HMRC by 19 September. The payment and deduction statements are due to subcontractors within 14 days of the end of the tax month, which is the same 19 September. The deductions are due to HMRC by the 19th as well, or by the 22nd where the payment is made electronically. The system schedules all three from the freeze on the 6th and treats the 19th as the deadline for everything except the bank transfer.

The return carries, per subcontractor, the payments excluding VAT, the cost of materials and the amount deducted, with two declarations: that the employment status of every subcontractor has been considered, and that every subcontractor needing verification has been verified. The freeze checks the second mechanically. The first is held as a dated decision a person made, per subcontractor, because it is a judgement.

Each statement carries the same three figures for one subcontractor, and the verification number where the subcontractor was unmatched. Because statements and return are rendered from the same frozen rows, a subcontractor querying their statement is looking at exactly the figure HMRC holds.

Nil months are back

For several years a contractor that paid no subcontractors in a month did not have to file anything. From 6 April 2026 that changed back: a contractor that paid nobody either files a nil return or tells HMRC in advance that it will not be paying subcontractors, and doing neither without a reasonable excuse brings a penalty. For a seasonal contractor, a quiet winter month now has a deadline where it used to have nothing.

The late filing penalties are GBP 100 the day after the deadline, a further GBP 200 at two months, and at six and twelve months the higher of GBP 300 or 5 per cent of the CIS deductions on the return. So the close treats a nil return as an output in its own right, and asks the question on the 6th of every month whether or not anything was paid.

What a compliance check walks

The five-link trace from a CIS deduction back to its evidenceA horizontal row of five boxes joined by arrows. A deduction: five hundred and twenty-four pounds on the plasterer's invoice. The base: three thousand eight hundred and sixty pounds less one thousand two hundred and forty pounds of materials. The materials: merchant receipts, attached and totalled. The rate: 20 per cent, from the verification record. And the verification: its number and date, or the carry-over from an earlier return. A note says an inspector picks a subcontractor and walks this, that it held for eleven of the fourteen subcontractors, and that the other three were nineteen thousand one hundred and eighty-nine pounds forty.FIVE LINKS FROM A DEDUCTION ON A RETURN TO THE PAPER BEHIND ITA deductionGBP 524 on theplasterer's invoiceThe baseGBP 3,860, lessGBP 1,240The materialsmerchant receipts,attached, totalledThe rate20%, from theverification recordVerificationnumber and date,or a carry-overAn inspector picks a subcontractor and walks this. It held for eleven of fourteen; the other three were GBP 19,189.40.
Fig 2. The trace an HMRC check follows, in the order it follows it. Every arrow is a stored link, written when the invoice was read.

Corrections are versions

A closed month is not edited. When receipts turn up for a materials figure that was left in the base, or a change notice was applied one payment late, the correction is a new version of that month with a reason and the rows that moved. Amending what was filed with HMRC is a person’s job; what the system guarantees is that the figures filed and the figures corrected both exist, side by side, with the difference explained.

HMRC’s guidance asks contractors to keep CIS records for at least three years after the end of the tax year they relate to. Most keep them longer for ordinary accounting reasons, and retention here follows whichever horizon is longer rather than the CIS minimum alone.

The evidence has to be captured on the day

Nothing here assumes a subcontractor is dishonest. A groundworker writing 46 per cent materials may well have bought a great deal of aggregate that year. The issue is that the receipts existed on the day and are gone eighteen months later when somebody asks, and the guidance makes the contractor the party responsible for having checked.

The sentence the evidence has to be able to write

  • The plasterer’s deduction in the tax month ending 5 September was GBP 524.
  • It is 20 per cent of a base of GBP 2,620: GBP 3,860 invoiced, less GBP 1,240 of materials.
  • The materials are three merchant receipts, attached, totalling GBP 1,240.
  • The rate comes from a verification on file, and the plasterer was on a return within the window.
  • The statement sent on 12 September shows the same figures.
  • The return filed on 16 September includes them, in version 1, never amended.

The next post prices it and the one after gives the service names, the tables and the IAM. The cost is almost all the invoice read, because every other step is subtraction and multiplication on figures the read already produced.

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