Self-employed Status - Frequently Asked Questions
What happens if the service provider disagrees with the outcome of the CEST Tool?
Last updated: Mon Mar 18 8:46
You should discuss the outcome with the service provider, explaining the outcome and the implications. If the service provider continues to disagree with the determination they may invoke the status disagreement process, firstly to the local People & OD Team. They will refer the matter to the Status Disagreement review panel for consideration.
What does self-employed mean?
Last updated: Thu Mar 21 11:46
While it is not defined in legislation, if a person is a business owner or contractor that provides services to other businesses, either directly or through a personal services company (PSC), they will generally be considered to be self-employed. Examples include IT Consultants, Project Managers, Business Analysts and other suppliers of professional services. It may also include specialist lecturers.
What do I need to do to engage a service provider?
Last updated: Mon Mar 18 8:46
Firstly, you should consider the most appropriate way of engaging an individual or service provider. Consideration should be given as to whether it would be more appropriate to engage someone as a casual worker or employee. Further details and advice can be found in the “Extended Workforce Policy”.
Before appointing an external service provider, you must complete the HMRC Check Employment Status for Tax Tool, (CEST). You can find the link for this online checking tool within the “Guidance - determining the employment status of service providers” along with details of how to complete, outcomes and next steps.
Further advice can be sought from HR or Finance if necessary. The output from the tool should be saved and emailed to your local HR team along with a completed Service Provider Brief Form, for review, endorsement or action accordingly.
Why is it important to determine employment status when engaging a service provider?
Last updated: Tue Mar 19 9:20
A person’s employment status is the gateway through which an individual’s employment rights and tax obligations are determined. The University is committed to engaging service providers in line with relevant UK legislation. If you are responsible for engaging service providers you must ensure that such services are engaged in a way that is compliant with such legislation and does not facilitate any form of tax evasion.
How do I determine whether someone is self-employed?
Last updated: Tue Mar 19 9:20
There are different tests associated with whether individuals are self-employed for tax purposes or for employment status.To support organisations in determining the employment status of service providers including for tax purposes, HMRC has developed an online assessment tool, Check Employment Status for Tax (CEST) Tool and this should be used in the first instance to help answer the question on self employment. Advice and guidance can also be sought from Finance and HR as necessary.