We are sharing this update from ACCA, our professional body, for the interest of clients and contacts. The content is (c) ACCA
Reminder to file monthly returns or face late filing penalties
From April 2026, Construction Industry Scheme (CIS) contractors are legally obliged to file a CIS return every month, including nil returns in months where they have not used a subcontractor.
CIS contractors are expected to choose any one of these options:
- File a CIS return showing payments.
- File a nil return where they have not used subcontractors.
- Submit an inactivity request which lasts six months.
CIS contractors can submit nil returns and inactivity requests through the CIS online service and some commercial CIS software.
Failure to file any kind of CIS return for the period 6 April to 5 May 2026 could result in the following late filing penalties:
- a first fixed penalty of £100
- a second fixed penalty of £200 after two months (in July 2026)
- a tax-geared penalty after six months (in December 2026) of a minimum of £300 or 5% of any liability which should have been shown on the return
- a further tax-geared penalty at 12 months, with the amount depending on why the return was late.
Penalties will only be issued where contractors have neither submitted an inactivity request nor filed a return.
Most CIS contractors who already file on time and submit nil returns or notify HMRC of periods of inactivity where required will be unaffected by these changes.