Changes to associate’s self-employed status
Changes to associate’s self-employed status
HMRC has updated guidance to confirm changes from April 2023

The long-rumoured change to associate’s “guaranteed” self-employment status was confirmed yesterday by HMRC.

Associates currently benefit from a dispensation with HMRC which says that they will be deemed self-employed when using a model-BDA contract. Guidance has been updated to confirm this dispensation will no longer apply from 6 April 2023.

This change is prompted by work that HMRC have been doing in this area over recent years. They’ve identified a number of dentists whose actual working arrangements do not match the contract they are operating under (employment status is always based on facts, not contracts) and we’ve seen sweeping changes to the operation of off-payroll working (IR35) in other industries. This is all under the guise of increased employment rights, but I’m sure HMRC won’t mind the increased tax take.

What will this mean? If you’re actually working in line with the contract you have in place, potentially nothing. This doesn’t prevent associates from being self-employed, it just means you have to actually be self-employed.

HMRC have a handy (but universally derided) tool to help determine your status and they welcome feedback on what results this is generating.

Coupled with upcoming National Insurance rates, this could be painful for associates deemed as employees.

This is perhaps more likely to lead to changes to how you work rather than increased taxes.

If you’ve got concerns, give us a call.

The information contained in this article is based on the opinion of Hive Business and does not constitute formal tax advice. Any tax outcomes will be based on individual circumstances, tax legislation and regulation, which are subject to change in the future. You should seek specific advice before embarking on any course of action. Hive Business does not provide regulated Financial Advice, including advice on investment, insurance or lending products or their suitability for you. This article is provided for information only and does not constitute, and should not be interpreted as, investment advice or a recommendation to buy, sell or otherwise transact, or not transact, in any investment including Bitcoin and other crypto. Any use you wish to make of any information contained within this article is, therefore, entirely at your own risk.

By Simon Vincent Senior Tax Accountant
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