What are my responsibilities as a contractor verifying subcontractors under CIS?

If you're a contractor engaging subcontractors, you must verify each one with HMRC before making your first payment to them, which tells you whether to deduct tax at 20%, 30%, or pay them gross, and you need to file a monthly CIS return reporting all payments made and deductions taken, even in months you paid nobody, if you're registered as a contractor.

Getting verification wrong — deducting the wrong rate, or missing a subcontractor off your return — creates real risk for you as the contractor, not just an inconvenience, since HMRC can penalise late or incorrect returns and hold you liable for under-deducted tax. Many small builders who occasionally bring in subcontractors don't realise that taking on even one subcontractor makes them a contractor for CIS purposes, with the monthly return obligation that comes with it, regardless of how small or occasional the arrangement is. If you're paying anyone to do subcontracted work on your jobs and haven't registered as a contractor or verified them properly, that's a compliance gap worth closing before HMRC finds it rather than after.