Understanding IR35 role assesments

16 March by Cognitive Group

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How can I get my role determined?

Under the off-payroll rules, from April 2021, private sector clients are responsible for determining a contractor’s IR35 status. The decision must be contained within a Status Determination Statement (SDS), alongside the client’s reasoning.

There are a number of tools available to you such as the ‘Check Employment Status for Tax’ ​(CEST) which is an online tool by HMRC that presents a series of questions to help determine employment status. However, it's been widely agreed that the determination can be challenged. Therefore, Cognitive have taken the decision to offer an IR35 insurance-backed route in which we carry out role assessments for free. Plus, it only takes 1 day to get a determination. This can either be lead by the client or the worker:

A) the client assesses the role first and determines the status

B) the worker completes the status assessment and this is sent to the client to agree or decline.

Key considerations for determination:

There are 4 main areas that make up a determination:

  1. Does the worker look like and feel like a Employee? (company laptop, employee swipe card, employee parking space etc.).

  2. How much autonomy does the worker have in providing the Services – where, when, how? Can the worker decline to do the work or decline an extension?

  3. Can the worker substitute themselves, without the Client needing to interview and without disruption of the Services?

  4. Is it a services assignment or a person assignment?  The more it looks and feels like a Services assignment...the more likely it will be deemed as "outside" IR35.

Sample questions

We've gathered a number of sample questions that should help you understand how the determination is assessed:

  • Will you expect the contractor to use their own autonomy and methodology in how they perform the services?

  • Will you expect the contractor to line manage any individuals within your organisation?

  • Will you expect to provide training, excluding any standard orientation, Health and Safety, or other legally required training, to the contractor?

  • Will you direct the contractor to rectify any sub-standard work in their own time and at no cost to your organisation?

  • Do you expect to be able to move the contractor away from the contracted assignment(s) to cover other tasks as required by your organisation?

  • Will you offer the contractor employment related perks and benefits as you do for an employee?

  • Will you require the contractor to provide their own business insurance and/or equipment? 

  • If the contractor was personally unavailable, would you allow them the right to provide a substitute worker of equivalent skill, qualification and experience?

  • Will the contractor be identifiable within your organisation as an independent contractor, for example, by wearing a visitor badge, including 'contractor' in their email signature, or being excluded from general company meetings?

  • Do you expect there to be a set end date to the engagement?

  • Do you expect the contractor to have an unconditional right of termination during the engagement period?

Please contact us directly if you'd like to discuss an insurance-backed solution to your IR35 challenges.