HMRC has added some revisions to the scenarios and guidance with The Check Employment Status for Tax (CEST) tool.
The (CEST) tool is used to assist employers in making determinations about a workers status, or employers/engagers can apply some of the template questions to their own checking questions to establish if a worker falls under the Off-Payroll rules (IR35 Intermediaries legislation).
Where a worker is caught by the intermediaries legislation, the fee-payer in the organisation must apply Tax and NICs to the workers deemed earnings and the individual will need to be reported on the Full Payment Submission (FPS). The deductions for tax and NI must be accounted in real time.
Since the introduction of Off-Payroll working in 2021, employers/engagers in the private sector have experienced many challenges in navigating the results from the tool, one of the main concerns was that the scenarios created by HMRC in response to the various questions did not typically represent working conditions in the private sector, and this would often lead to indecision in the outcome.
With effect from 30 April 2025,HMRC is revising its CEST digital tool, stating the
changes “will make it easier to use the tool and receive an accurate outcome”.
The check employment status for tax tool has been amended to simplify the language,
they have also removed information for some customers where special rules apply and
covered this within the tool itself. Useful links have also been included for related
guidance.
To support these changes, HMRC will also publish updated guidance that offers help on
how to answer the revised questions.
