CIS Payroll Finance UK 2026

Market Invoice is an independent UK invoice finance comparison site that ranks 87 UK invoice finance providers.

CIS payroll finance is specialist UK construction finance built for businesses paying weekly subcontractor payroll under the Construction Industry Scheme while waiting 30 to 60 days for monthly Application for Payment receipts from main contractors. Specialist providers fund the weekly outgo against the monthly inflow; ask each one how it handles CIS deductions (20 percent for registered subcontractors, 30 percent for unregistered, 0 percent for gross status) and your monthly CIS returns. Paying weekly while being paid monthly is one of the commonest cashflow problems for SME contractors employing CIS subcontractors.

What this page covers

This page covers

CIS payroll finance UK: funding the gap between weekly subcontractor payments and monthly main contractor receipts, CIS handling

Not covered here

General invoice finance education (see /guides/), individual provider reviews (see /providers/), full pricing breakdown (see /guides/costs/)

UK providers worth knowing

ProviderFee fromMin turnoverWhy it fits
Pulse FinanceNot published£1mConstruction named, but no CIS detail published
Bibby Financial ServicesNot publishedNot publishedLarge subcontractor credit control
SonovateVariableNo minWeekly payroll specialism
AldermoreNot published£750kLarger CIS-paying construction businesses
AP

Adam Parker

Founder & Managing Director, Muswell Rose, founder and PSC of Best Business Loans Ltd

Adam is the founder and managing director of Muswell Rose and a founder of Best Business Loans Ltd, the company behind Market Invoice. He spent over three years as managing director of Penny, a UK invoice finance business, and his career runs through insurance, mortgages, commercial finance and fintech lending. He writes the Market Invoice library.

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CIS Payroll Finance UK FAQ

What is CIS payroll finance?

Specialist construction finance that funds the gap between weekly Construction Industry Scheme subcontractor payments and monthly Application for Payment receipts from main contractors. Includes CIS deduction handling, CIS300 reporting integration, and HMRC remittance management.

Why is CIS payroll a cashflow problem?

CIS subcontractors (most labour-only and labour-and-plant trades) are paid weekly. Main contractors pay AfPs monthly, 30-60 days after submission. So, as an illustrative example, a subcontracting SME with 20 CIS subcontractors at £800/week each has £16k weekly outflow but only sees the corresponding £64-80k monthly AfP receipt 30-60 days later. Without CIS payroll finance, growth requires huge working capital reserves.

How do CIS deductions work in finance facilities?

Standard rate (20%) is deducted by the contractor from the subcontractor's labour element (not materials) and paid to HMRC. The finance facility advances against the gross AfP value, with CIS deductions netted off the certified payment when received. The net effect is the subcontracting SME receives gross funding, pays subcontractors net of their CIS, and pays those deductions over to HMRC monthly. The deductions are HMRC's money, not extra working capital.

Best providers for CIS payroll finance?

Bibby Financial Services (large subcontractor credit control), Sonovate (weekly payroll specialism though primarily for recruitment), Aldermore (large-business construction). Specialist sourcing matters more than rate because CIS reconciliation, CIS300 timing, and gross status edge cases need provider competence.

Does CIS gross status help my financing?

Yes. Gross status (0% deduction) means the subcontractor receives the full payment from your business, with no CIS deducted. From a cashflow perspective this is harder because gross receivers need 100% of their billed amount. From a financing perspective it's neutral; the facility funds the gross AfP either way. Payments to gross-status subcontractors still go on your monthly CIS return (HMRC asks for all payments made to subcontractors), but there is no deduction to pay over.

Can I use CIS payroll finance for tax payments to HMRC?

The facility funds working capital generally, including HMRC payments (CIS deductions, PAYE, VAT). Funds aren't ringfenced. Some providers will issue a separate VAT invoice finance line for VAT payment-cycle funding (90 days quarterly). Worth asking specifically if HMRC payments are causing the cashflow pinch rather than subcontractor payroll.