FreeAgent has introduced a significant update to its platform, aimed at simplifying the management of the Construction Industry Scheme (CIS) for contractors and helping them comply with the government’s Making Tax Digital (MTD) legislation.
The new functionality allows contractors to track CIS deductions, generate CIS300 returns, and create Payment & Deduction Statements, all within FreeAgent’s software.
Previously, the platform supported subcontractors, but with this update, the system now fully accommodates all businesses operating under the CIS umbrella.
The update is designed to assist contractors in meeting the new MTD for Income Tax requirements, which come into effect in April 2026.
Under these rules, self-employed individuals earning more than £50,000 annually will be required to maintain digital tax records and submit quarterly updates to HMRC.
FreeAgent’s new features aim to help contractors prepare for this transition by streamlining their CIS and tax processes in advance of the deadline.
Roan Lavery, CEO and co-founder of FreeAgent, commented:
“We’ve long supported subcontractors working under the Construction Industry Scheme, so we’re delighted to now be able to provide full CIS support for contractors and their accountants. This has been one of the most requested features from our contractor accountant partners, and we anticipate it will be warmly welcomed and appreciated.”
The introduction of these new tools is expected to improve efficiency for accountancy practices, enabling them to better assist their CIS contractor clients as they transition to digital tax reporting. Lavery added:
“With MTD for Income Tax coming into effect from next year, we are going to see many more contractors being required to use digital software to keep their records and make tax updates to HMRC. With CIS support now built into FreeAgent, accountants will have a complete solution for their contractor clients that will help digitise their finances and enable them to fully comply with their legislative requirements.”