What is the Construction Industry Scheme (CIS)?
Under the Construction Industry Scheme (CIS), contractors deduct money from subcontractor payments and pass it to HMRC. These deductions are treated as advance payments towards the subcontractor’s tax and National Insurance.
If your Dext account is integrated with Xero, Sage 50, or QuickBooks Online, you can apply:
CIS category codes
This ensures the correct tax treatment is applied when publishing records.
Before you begin
Make sure CIS is enabled in your accounting software:
CIS must be active in your integration before publishing CIS-related records from Dext.
How to apply CIS category codes in Dext
To ensure CIS information is published correctly to your accounting software:
Make sure the supplier name in Dext exactly matches the CIS contact name in your integrated software.
Open the item and select the correct CIS category from the Category dropdown
Review the tax rate and details.
Click Publish.
Once published, the record in your accounting software will include the relevant CIS information.
Important: If you are using QuickBooks Online, you must manually adjust the Less CIS field after publishing.
How to split labour and materials for CIS
If an invoice or receipt includes both labour and materials, you need to split the lines correctly to ensure accurate CIS deductions.
Use Line Items to:
Allocate labour to CIS - Labour Expense
Allocate materials to Materials Purchased
This ensures the correct deduction is automatically set up in your accounting software.
To automate this process further, you can use:
How to enable Domestic Reverse Charge (DRC)
If applicable to your business, you can also enable Domestic Reverse Charge (DRC) tax rates in your Dext account to ensure VAT is handled correctly for CIS-related transactions.
Make sure DRC is also configured correctly in your accounting software.
Key tips for working with CIS in Dext
Always match supplier names exactly between Dext and your accounting software.
Confirm CIS is enabled in your integration before publishing.
Split labour and materials correctly to ensure accurate deductions.
Review published entries in QuickBooks Online to adjust the Less CIS field if required.