On 30 April 2025, HMRC stated that it made revisions to its CEST digital tool to make it easier to use, along with updates to the tool's user manual to offer help on how to answer the questions.
So, what actually changed? The short answer - nothing at all. Previous questions are unchanged. The decision logic is identical. Everything remains the same as the version released in November 2019, four and a half years ago.
The old CEST logic stays
Since the CEST questions and logic were last updated in Nov 2019, there have been circa 30 IR35 tribunal hearings and other key status decisions, where the status case law has moved on and finally settled down.
HMRC based its CEST logic on its "view" of status in November 2019, yet key status submissions it made at the Court of Appeal in Atholl House (April 2022) and the Supreme Court in PGMOL (September 2024) failed. Yet, CEST remains unchanged.
Over the last few years, the logic behind the government's HMRC Status Tool (CEST) has gradually unravelled.
So what actually changed in CEST?
Before the changes, we saved a copy of all the CEST screens and guidance and compared them again after the big reveal of 30 April 2025. The differences are:
- CEST asks you to confirm that there is a contract in place.
- The option of "Agency" is removed from "Who are you?"
- The disclaimer is reworded but is essentially the same.
- The question "Has the worker started?" has been moved.
That's it.
CEST User Manual updates
The CEST User Manual available online at ESM11000 has had some updates. CEST users should pay careful attention to the sections on substitution, control and financial risk.
There are two ways of interpreting HMRC's recent guidance changes:
- HMRC are steering users away from the answers that result in "outside IR35."
- HMRC are signposting to users which answers they are likely to robustly challenge.
As successive changes to ESM11000 have been made, the CEST tool and guidance have become less integrated, leaving the tool unable to stand on its own. HMRC have offloaded essential logic or decision-making to external guidance instead of embedding it into the tool itself.
Fixing the users, not the tool
With the major changes being to the guidance instead of the tool, it appears that rather than undertake the huge task of fixing CEST, HMRC is instead trying to fix the answers its users provide.
If your business hires contractors and needs IR35 status tools, protection, consultancy or advice, book a call with an expert.
