Accountants for Tilers

Tiling is inside the Construction Industry Scheme. Carpet fitting is outside it.

Tiling a floor or a wall is a finishing operation carried out on a building, which puts it inside the scheme with no test to apply and nothing to argue.

Carpet fitting is the odd one out. HMRC’s guidance lists it among the work the scheme does not cover, and the carve-out is written narrowly. It applies to carpet. It does not stretch to vinyl, LVT, resin, timber or tile.

That surprises people who assume anything laid on a floor gets the same treatment. If you tile a bathroom and the firm next door fits the bedroom carpets on the same site, you are in the scheme and they are not.

Where tilers actually get caught

The scheme scope is settled. What causes trouble is everything around it.

Screeding and subfloor preparation. Levelling compound, screed, tanking and moisture suppression are construction operations in their own right. Doing them as part of a tiling package does not take them outside CIS.

Your own fixers. Most tiling firms of any size run subcontract labour. Paying tilers as subcontractors makes you a contractor under the scheme, with verification, deduction, statements and a monthly return due on every one of them.

Mixed floor covering work. If you have widened into carpet as well as hard flooring, the carpet element sits outside the scheme and the rest sits inside it. That has to be visible on the invoice rather than assumed.

Snagging and replacement visits. Going back to replace cracked tiles on a completed contract is still a construction operation, even though the money is small and the paperwork feels disproportionate.

Domestic work does not follow the same VAT rules

A large share of tiling revenue comes straight from homeowners. Bathrooms, kitchens, hallways, conservatories.

When you work directly for a householder, they are the end user. The domestic reverse charge does not apply, and you charge VAT in the normal way and pay it over. The reverse charge only bites where your customer is VAT registered, CIS registered and passing the work on.

So a tiling firm with a builder’s contract on one side of the ledger and private customers on the other is running two different VAT treatments in the same month. Applying the reverse charge to a homeowner is the error we see most often, and it means you have failed to charge VAT you were due to charge.

Some domestic tiling also forms part of a project qualifying for a reduced rate, on certain conversions and long-term empty properties. The conditions are specific and worth checking before you quote rather than after.

Materials, and the wastage nobody costs

Tiling is a material-heavy trade, and the material is fragile.

Two things follow from that. CIS is calculated on the labour element of an invoice, so materials shown separately are excluded from the deduction. Bury the lot in one figure marked “tiling works” and a contractor will apply 20% across all of it, leaving you to reclaim the difference through your corporation tax return months later.

The second is wastage. Cuts, breakages, batch shade differences and the tiles a client changes their mind about are a real cost that gets absorbed into overheads and never lands on the job that caused it. A firm holding stock for four live jobs and buying against a fifth has usually lost track of what any single job consumed.

Stock held for jobs also has to be dealt with properly at year end. Tiles sitting in a unit on 31 March are an asset, not a cost of that year, and getting that wrong moves your profit and your tax bill.

Pricing per square metre against what the metre actually costs

Most tiling is quoted per square metre, with the rate coming from what the last job went out at.

That works while the jobs look alike. It stops working the moment size, format or substrate changes. Large format porcelain, mosaic, a wall that needs boarding first and a floor that needs levelling all take different hours per metre, and the same rate applied across them hides which ones lose money.

Cost recorded against the job, including labour hours, materials actually consumed, breakages and the return visits, is what turns a rate into a margin. Most tiling firms find their domestic work carries a better margin than their contract work, and are running hard after the contract work anyway.

What we do

Work out which parts of your work sit inside CIS and which do not, and set your invoicing up to match.

CIS run monthly where you pay your own fixers, including verification, deductions, returns and statements.

VAT handled across domestic and contract work, with the reverse charge applied only where it belongs.

Job costing per contract, including materials consumed and wastage, so your square metre rate is built on real numbers.

Underneath it, the usual. And the standard work underneath it. Accounts, corporation tax, VAT, payroll and self assessment.

Who we work with

UK tiling and hard flooring limited companies turning over between £500,000 and £5 million, anywhere in the UK.

Common questions

Do tilers need to register for CIS?
Yes. Tiling is a construction operation. If you also pay subcontract fixers, register as a contractor as well as a subcontractor.

Carpet fitting is excluded, so is tiling excluded too?
No. The exclusion covers carpet and nothing else. Tile, vinyl, LVT, resin and timber are all treated on the ordinary rules.

Does the reverse charge apply when I tile a private house?
No. A homeowner is an end user, so you charge VAT in the normal way.

Should CIS be deducted from my tiles and adhesive?
No. The deduction applies to labour. Show materials separately so the contractor can exclude them.

Is the screeding I do before tiling inside the scheme?
Yes. Screeding and subfloor preparation are construction operations on their own, whoever does them.

Book a call. We will go through your last six months of invoices and tell you where VAT and CIS have been applied to the wrong side of your work.

Book a call