Calling someone self-employed does not make them self-employed.

Status is decided by how the relationship actually works, not by what the contract calls it. Getting it wrong is expensive for both sides.

The appeal, and the risk

A large number of workers operate as self-employed, so that the engaging business does not deduct income tax from a payslip and the relationship does not need to be formalised as employment. The law permits this — but only where the arrangement genuinely is self-employment.

HMRC and employment tribunals both look past the label to the substance of the relationship. If the reality is employment, the paperwork will not save either side.

What actually determines status

Control — who decides what work is done, how, when and where
Personal service — must this individual do the work, or can they send a substitute?
Mutuality of obligation — is the business obliged to offer work, and the individual obliged to accept it?
Financial risk — who provides equipment, who bears the cost of correcting defective work, is there real opportunity for profit or loss?
Integration — is the individual part of the organisation, or genuinely running their own business?

Three statuses, not two

English law recognises employees, workers and the genuinely self-employed. “Worker” sits between the other two and carries real rights — holiday pay, the national minimum wage, protection from unlawful deductions — even though the individual is not an employee. A great many arrangements labelled self-employed are in fact worker arrangements.

If you are self-employed yourself

Registration with HMRC, self assessment, allowable expenses, national insurance and whether to incorporate as your income grows. We advise on all of it, and handle the filing.

What this covers

Employment status assessment
Contractor and consultancy agreements
IR35 and off-payroll considerations
HMRC registration for the self-employed
Self assessment returns
Allowable expenses and record keeping
Advice on when to incorporate

In detail

How we help.

Status review

An honest assessment of whether your contractors are genuinely self-employed, before HMRC forms its own view.

Agreements

Contractor and consultancy agreements that reflect a real self-employment relationship.

Tax and filing

Registration, self assessment and expenses handled correctly from the first year.

FAQ

Common questions.

What is the risk of getting status wrong?

For the engaging business: unpaid PAYE and national insurance, interest and penalties, plus potential claims for holiday pay and other worker rights. For the individual: unexpected tax liabilities and lost entitlements.

Does a substitution clause make someone self-employed?

Not on its own. A genuine, unfettered right to send a substitute is a strong indicator, but a clause that has never been used and that the business would refuse in practice carries very little weight.

What is the difference between a worker and an employee?

Workers have some statutory rights — holiday pay, minimum wage, protection from unlawful deductions — but not others, such as protection from unfair dismissal or statutory redundancy pay.

Should I incorporate instead of staying a sole trader?

It depends on your income, your risk exposure and whether you need to bring anyone else in. There is a level of profit above which incorporating usually makes sense; we will run the comparison on your numbers.

Corporate & Commercial

The full practice area this sits within.

Limited Company

A related service in the same area.

HR

A related service in the same area.

Get in touch

Tell us what you are dealing with.

Email

info@newvisionlegalsupport.com

Telephone

07534636866

Office

London, United Kingdom