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The determination of the correct schedule of charge, in the public sector, is for the contracting authority to decide. The manager who is engaging with a supplier is required to use the HMRC check employment status for tax (CEST) tool.

The CEST tool provides HMRC’s view of the employment status (for tax purposes) of a particular engagement. It asks a series of questions about the circumstances, before providing an indicative determination on whether or not the engagement should be classed as employed for tax purposes.

The tool can reach a number of outcomes as listed below:

  • the intermediaries legislation (known as IR35) does not apply to this engagement

  • this engagement should be classed as self-employed for tax purposes

  • unable to determine the tax status of this engagement

  • this engagement should be classes as employed for tax purposes.

Full details of the procedure for engaging people who are claiming self-employed status can be found in St George’s employment status guidance.

 

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