FreeAgent Launches Construction Industry Scheme (CIS) for Simplified Subcontractor Management

FreeAgent has introduced the Construction Industry Scheme (CIS), designed to streamline subcontractor management and facilitate the digital tax transition for contractors. This update enhances FreeAgent’s capabilities, allowing users to monitor deductions, generate CIS300 returns, and produce Payment & Deduction Statements for their subcontractors within a unified platform.

Previously, FreeAgent had supported CIS subcontractors through its software; however, this recent optimization ensures full support for all parties operating under the CIS framework.

Moreover, this upgrade is aimed at helping contractors comply with Making Tax Digital for Income Tax, which is part of the government’s initiative to digitize tax processes for UK businesses. Starting in April 2026, legislation will require self-employed individuals and landlords earning more than GBP 50,000 annually to maintain digital records and submit quarterly updates to HMRC regarding their tax obligations.

FreeAgent believes that this expansion of CIS support will boost the efficiency of accounting practices, enabling them to better assist their CIS contractor clients in adapting to digitization and preparing for MTD compliance.

According to FreeAgent representatives, as Making Tax Digital (MTD) for Income Tax comes into effect next year, a growing number of contractors will be mandated to use digital tools for record-keeping and submitting tax information to HMRC. With the integration of CIS support into its platform, accountants can now provide the necessary solutions for their contractor clients, assisting them in digitizing their finances and ensuring full compliance with legal requirements.