Creating Construction Industry Scheme Invoices

Learn how to create Construction Industry Scheme (CIS) invoices in Billo Invoicing with proper categorization and deduction calculations.

Enabling CIS on Invoices

Step 1: Enable CIS Toggle

  1. Create or edit invoice
  2. Find CIS section
  3. Toggle Enable CIS on
  4. Section expands

Step 2: Set CIS Rate

  • If client has CIS: Rate auto-populates
  • If no client CIS: Select rate manually
  • Options: 0% (Gross), 20% (Standard), 30% (Higher)
  • Rate determines deduction

Step 3: Categorise Line Items

  • Labor: Construction work (CIS applies)
  • Materials: Supplies (no CIS)
  • Other: Miscellaneous (typically no CIS)

CIS Calculation Process

Step 1: Categorize Items

  • Assign category to each item
  • Labor items: CIS deduction applies
  • Materials: No deduction
  • Other: Check applicability

Step 2: Calculate Totals

  • Labor value: Sum of labor items
  • Materials value: Sum of materials + other
  • Subtotal: All items total
  • VAT: Calculated if applicable

Step 3: Apply CIS Deduction

  • CIS rate × Labor value
  • Shown as deduction
  • Reduces payment due
  • Displayed in breakdown

Step 4: Final Totals

  • Net Payment Due: Total - CIS deduction
  • Gross Total: Total before CIS
  • CIS Deduction: Deduction amount
  • Breakdown shown clearly

CIS Invoice Display

Invoice Breakdown Shows:

  • Labor Value: Total labor items
  • Materials & Other: Total materials
  • CIS Deduction (X%): Deduction amount
  • Net Payment Due: Amount after deduction
  • Gross Total: Total before deduction

Visual Indicators

  • CIS section highlighted
  • Deduction shown clearly
  • Rates displayed
  • Breakdown easy to understand

Best Practices

Categorization

  • Categorize accurately
  • Separate labor and materials
  • Use correct categories
  • Review before sending

Rates

  • Use correct deduction rate
  • Verify client status
  • Check HMRC guidelines
  • Update if status changes

Documentation

  • Include CIS breakdown
  • Show calculations clearly
  • Maintain proper records
  • Keep for HMRC returns

Common Scenarios

All Labor Work

  • All items categorized as labor
  • CIS applies to full amount
  • Materials value: £0
  • Deduction on total

Mixed Work

  • Some labor, some materials
  • CIS on labor only
  • Materials excluded
  • Net = Total - Labor deduction

Materials Only

  • No labor items
  • No CIS deduction
  • Standard invoice
  • No CIS breakdown

Creating CIS invoices correctly ensures compliance!