CEST exposed: New proof that HMRC's IR35 tool won't protect you

A detailed CEST webinar which proves HMRC’s IR35 tool rarely conducts multi-factorial assessments when handing out “Outside IR35” determinations - putting clients in considerable danger.


Our CEO Dave Chaplin compares the publicly available CEST programming code to HMRC’s arguments and the judge’s decisions in the recent IR35 case at the Court of Appeal and proves that, whilst CEST appears to conduct proper assessments when concluding “Outside IR35”, it simply doesn’t and instead relies on what he calls “unicorn assessments”.

Primarily, when CEST delivers an “Outside IR35” result it only does so based on a small number of unrealistic answers, ignoring all other answers given, and without conducting a full multi-factorial assessment - contrary to binding law from the Court of Appeal.

HMRC’s IR35 tool is essentially just searching for contractor unicorns. And if it cannot spot one, it will indicate “Inside IR35” or “Don’t know” when it actually conducts a proper multi-factorial assessment. That’s not what the law states and is woefully biased.

More worryingly, is that those receiving an “Outside IR35” determination are relying on unrealistic answers, which in our tribunal experience, HMRC will challenge in a heartbeat. The unicorns, sadly, won’t survive.

The CEST tool, which was updated in November 2019, has lulled tens of thousands of users into a false sense of security. Hopefully, you are not one of them who is relying on the “CEST Unicorn Defence”.

If you would like to speak to our experts about any aspect of this webinar, please contact our team.