Why Has Your Tax Rebate Changed?

The Crucial Role of CIS Statements in Your Tax Return

You filed your tax return after April 6th expecting a well-earned rebate—only to find your refund later shrunk, vanished, or even reversed into a tax bill. Sound familiar? You’re not alone. This year, we’ve seen this happen to many taxpayers working under the Construction Industry Scheme (CIS), and here’s why.

🧱 CIS Deduction Rates: Why They Matter

If you’re in construction, your income often has tax automatically deducted—either at 20% or 30%, depending on whether you're registered under CIS. This deduction is meant to count toward your yearly tax obligation. But if the details aren't properly connected to your UTR (Unique Taxpayer Reference), HMRC may not credit it to your account.

Let’s break it down:

❌ If You're Not Registered Under CIS (Taxed at 30%)

• Your UTR appears as “Unmatched”, meaning HMRC can't link the tax deducted to your personal account.

• Contractors still pay tax on your behalf, but it’s linked to a temporary verification number, not your UTR.

• When you file your return, HMRC sees no CIS tax paid—so your expected rebate can vanish or flip into a tax charge.

✅ If You're Registered Under CIS (Taxed at 20%)

• Your deductions are correctly tied to your UTR.

• However, issues can still arise:

  • Your contractor failed to pay HMRC

  • HMRC’s records contain discrepancies

  • Reporting delays throw off matching with your tax return

📩 What Happens Next?

You’ll likely receive a Section 9A personal tax inquiry letter from HMRC. This letter outlines why they amended your rebate and includes a new tax calculation based on what they see as accurate.

🛠️ How to Fix It: Your Action Plan

If HMRC’s revised calculation looks correct, you don’t need to do anything. But if you disagree, act quickly within the stated deadline. You’ll need to supply supporting evidence, such as:

• ✅ CIS statements from your contractor (check here for more info about them)

• 📄 Bank statements showing contractor payments

• 🧾 Copies of invoices issued

• 💰 Receipts for claimed expenses

Once HMRC reviews and verifies these documents—particularly CIS statements that match your bank entries—your original rebate may be reinstated.

📣 Why CIS Statements Are Non-Negotiable

Too many taxpayers miss out simply because they lack the right paperwork. CIS statements are your tax lifeline—a vital record confirming what’s been deducted and paid. Without them, your return may not reflect your actual tax position.

🧭 Need Help Navigating This?

At Accounted 4 Tax Ltd, we specialise in guiding construction professionals through these kinds of HMRC challenges. If your rebate changed unexpectedly or you received a Section 9A inquiry:

👉 Reach out today for personalised support

👉 Let’s get your records in order and your rebate restored