The Bottom Line
- IR35 risk is about the nature of the working relationship, not your job title.
- Status decisions often hinge on control, substitution, and mutuality of obligation (practically: how ‘staff-like’ you are).
- Do not choose a structure first. Assess status first, then choose a structure that matches reality.
- If you use HMRC’s status tools, record your inputs and keep the output as evidence.
- Avoid ‘blanket’ assumptions. But also avoid magical thinking: if it behaves like employment, treat it as such.
The strategic mistake doctors make
Building a limited company for ‘tax efficiency’ before understanding IR35 status.
If the engagement is inside IR35, the efficiency often collapses and complexity rises.
The clinician translation of IR35
IR35 (off-payroll rules) is essentially the tax system asking: “If you removed the intermediary, would this have looked like employment?”
Doctor-specific reality: many locum arrangements are operationally staff-like (set rota, supervision structures, fixed processes). That does not mean every engagement is inside IR35 — but it does mean you must assess rather than assume.
How to pressure-test an engagement (doctor edition)
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1) Control: who decides how the work is done?
If the organisation controls how, when, and where you work in a staff-like way, IR35 risk increases.
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2) Substitution: can someone else do the work?
Genuine substitution is rare in clinical settings, but understand the contractual and practical reality.
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3) Mutuality of obligation: is there ongoing obligation?
If you are effectively treated like continuing staff (expected ongoing work), that is a risk signal.
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4) Financial risk and ‘in business on your own account’
Multiple clients, your own insurances, genuine autonomy, and business-like behaviour can be relevant — but it must reflect reality.
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5) Documentation
Keep contracts, booking confirmations, and any status determinations. Evidence beats opinions.
HMRC CEST tool: use it properly (if you use it at all)
If you use HMRC’s CEST tool, treat it like documentation:
• Save the output.
• Save the inputs you entered.
• Ensure the inputs reflect reality, not aspirational framing.
If reality changes (e.g., you become staff-like), reassess.
SourceBMA — IR35: how it affects doctors (official professional guidance)
Open Link SourceGOV.UK — Check Employment Status for Tax (CEST) (official)
Open Link