NEWS

New version of IR35 checking tool

HMRC has released an updated version of the Check Employment Status for Tax (CEST) tool, which is used to determine whether a contractor should be classed as employed or self-employed for tax purposes, and in line with IR35 legislation.

The tool was originally created in 2017 when HMRC introduced new off-payroll rules to the public sector which saw some contractors' net income cut significantly. HMRC also shifted the responsibility for compliance from the individual contractor to a public body or recruitment agency. 

From 6 April 2020, IR35 rules will be extended to medium and large organisations in the private sector.

The CEST tool had been criticised by businesses for its inaccuracy and not being fit for purpose. HMRC promised to improve the CEST tool before April's extension of IR35, and has consulted stakeholders to help guide the update.

Link to HMRC's Check Employment Status for Tax tool

 

26/11/2019

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REF: MC/NL/1.2