Choosing A CIS Statement Tool: What To Check Before You Use One

A useful CIS statement tool should not pretend to replace HMRC verification, professional judgement or monthly filing. It should do a narrower job well: apply the arithmetic to the figures and HMRC status you enter, prepare statements using HMRC-listed fields, flag obvious review items, and make the monthly paper trail easier to keep.

1. Does It Use The HMRC Deduction Method?

GOV.UK says contractors start with the gross invoice amount, take away VAT and specified items such as materials paid for directly by the subcontractor, then apply the CIS percentage rate HMRC gives when the subcontractor is verified.

Test any tool with a simple example:

• gross excluding VAT: GBP 2,400
• materials: GBP 600
• amount liable to deduction: GBP 1,800
• 20% deduction: GBP 360
• net payment: GBP 2,040

If a tool cannot explain that calculation clearly, do not rely on it.

2. Does It Prompt For Verification Evidence?

GOV.UK says contractors need to verify new subcontractors before paying them, and HMRC tells the contractor whether the subcontractor is registered, which deduction rate to use, or whether they can be paid gross.

A practical tool should make the selected status visible and prompt for a verification number when the higher rate is used because the subcontractor could not be verified.

3. Does It Use HMRC-Listed Statement Fields?

CIS340 says statements must include contractor details, tax month/date, subcontractor details, UTR, verification number where the higher rate was used because verification failed, gross amount, amount liable to deduction and amount deducted. HMRC's example statement also shows materials and amount payable.

Look for a statement output that makes those fields easy to review, print, save and issue.

4. Does It Keep Data Local?

Subcontractor names, UTRs and payment amounts are sensitive business data. A browser-only tool that runs locally can be useful because it does not need to upload that information to a third-party server. That does not remove your own data-protection obligations, but it reduces the number of systems involved.

5. Does It State Its Limits?

Avoid tools that imply they can make you compliant or file for you unless they actually connect to HMRC and are qualified/authorised for the work. A narrowly scoped tool should say clearly that it does not:

• verify subcontractors
• decide whether a payment falls within CIS
• decide what counts as materials
• file the monthly return
• pay HMRC
• apply VAT or domestic reverse-charge treatment
• provide tax, legal or accountancy advice

Where The CIS Monthly Reconciler Fits

The CIS Monthly Reconciler is a one-time browser tool for the monthly review workflow. You paste a month of payments, it applies the selected HMRC status/rate to the figures entered, flags common review items, prepares statements using HMRC-listed fields, and exports a CIS300 review summary and sign-off checklist.

Try the free single-payment checker first: Run the free checker.

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Sources reviewed on 19 June 2026: GOV.UK "What you must do as a CIS contractor" pages, CIS340 contractor/subcontractor guide, and HMRC example payment and deduction statement. Re-check current GOV.UK guidance before relying on any rate, date or field.