Whether you or the practice decides your employment status for tax has nothing to do with your own company, your day rate or your contract wording. It depends entirely on how big the client is. Work across independents and a corporate group in the same year and you are in two different regimes at once.
Guide · Updated August 2026
There is no single IR35. There are two statutory regimes and the dividing line is the size of the client — the practice or group that engages you — not anything about you.
| Chapter 8 ITEPA 2003 | Chapter 10 ITEPA 2003 | |
|---|---|---|
| Applies when the client is | Small (private and voluntary sectors) | Medium or large |
| In place since | 2000 | Reformed from 6 April 2021 |
| Who decides status | The worker's own intermediary | The client |
| Paperwork | None issued to the worker | A Status Determination Statement |
| Who operates PAYE if inside | The intermediary, through the deemed employment payment | The fee-payer, at source |
| Who carries the tax risk | The intermediary | The client or fee-payer |
The gov.uk position on the small-client case is worth having in front of you, because it is frequently reported the other way round: if you are a small-sized client in the private and voluntary sectors you will not have to determine the employment status of workers you engage through their own intermediaries, and this will remain the responsibility of the worker's intermediary.
So a small practice owes you nothing on status. It does not have to assess you, does not have to issue anything, and cannot give you cover. The determination — and the exposure if it is wrong — sits in your own company.
The CMA's final report gives us the numbers, and they map onto the two regimes unusually cleanly.
The practical result is a locum working a mixed week in two tax regimes simultaneously. Three days at independents where your company determines status and carries the risk, and one day at a group site where a Status Determination Statement arrives and PAYE is deducted before you are paid. Nothing about your working pattern changed; the tax treatment did.
Illustrative example — one locum, two regimes, one tax year. Assume 150 working days in the year: 110 at small independent practices and 40 at sites owned by one of the six groups (110 + 40 = 150). Assume, purely so the arithmetic is visible, a day rate of £400. This guide makes no claim about what locum day rates actually are — see the last section on why.
The independent work is 110 × £400 = £44,000. Chapter 8 applies: your company decides status, invoices gross, and carries the risk of getting it wrong.
The group work is 40 × £400 = £16,000. Chapter 10 applies: the client issues a Status Determination Statement, and if it says inside, the fee-payer deducts PAYE and National Insurance before paying your company. Total invoiced 44,000 + 16,000 = £60,000, of which 27% (16,000 ÷ 60,000 = 26.67%) arrives already taxed at source.
Two consequences fall out of that. The company's profit is no longer 60,000 less costs, because the £16,000 has already been taxed as employment income — dividending it out again is not the plan. And the Employment Allowance is never available in respect of workers within the off-payroll rules, so that route is closed for the group work too. Figures are illustrative.
Client size uses the Companies Act criteria. Two of the three were increased with effect for financial years beginning on or after 6 April 2025, per HMRC's manual at ESM10006A:
Here is the part almost nobody has registered. HMRC states in the same manual that the earliest tax year the transitional provision will impact a client is 2027/28, because the earliest possible filing date for an accounting period beginning on or after 6 April 2025 is in January 2027, which is relevant for the 2027/28 tax year. So the higher thresholds do not change who is small for engagements today. A practice group that was medium-sized under the old thresholds is still running Chapter 10 for now, even if the new turnover test would eventually take it out.
For a locum, the useful discipline is to stop guessing. If a Status Determination Statement arrives, the client has decided it is medium or large and Chapter 10 applies. If nothing arrives, do not treat silence as a determination that you are outside IR35 — treat it as evidence the client is small, which means the determination is yours to make and to document.
HMRC's Check Employment Status for Tax tool is, in HMRC's own words, the only tool where HMRC will stand behind the determinations made — as long as the information you use to make the determination remains accurate, and is in line with HMRC's guidance.
Both halves of that condition do work, and both are how a CEST result stops being worth anything:
Save the output with the date, the engagement it relates to and the contract version it was run against. A determination you cannot evidence is a determination you cannot rely on, and under Chapter 8 the exposure is your company's.
Worth saying plainly: HMRC publishes no sector-specific guidance for veterinary locums. There is no special treatment, no agreed industry position and no concession. The test is the general one — whether the individual would have been an employee of the client had the engagement been direct — assessed on the ordinary status factors in HMRC's Employment Status Manual: personal service and the right of substitution, control over what, how, when and where the work is done, mutuality of obligation, financial risk, provision of equipment, and whether the person is in business on their own account.
Applied to clinical locum work, three of those are usually where the answer lives. Control over how the work is done is complicated by the fact that clinical judgement is the locum's own professional obligation under the RCVS Code, not the practice's instruction. Provision of equipment usually points towards employment, because the practice supplies the building, the theatre, the dispensary and the practice management system. And financial risk depends on whether you carry your own indemnity cover, your own registration and the cost of your own mistakes — which is one practical reason not to rely on the host practice's insurance, as the RCVS itself warns in the guidance covered in our RCVS compliance guide.
One CMA point is relevant here rather than incidental. Draft Article 13 of the Order will require veterinary businesses to have policies ensuring that vets and nurses can act in accordance with their RCVS Codes. That is a document about clinical autonomy, and clinical autonomy is a status factor. It does not decide anything on its own, but it will exist in writing where it previously did not — see our CMA remedies guide.
How locum veterinary work is commercially contracted — agency versus direct engagement, prevailing day rates, notice periods, mileage and accommodation conventions — is not documented in any primary source. The RCVS addresses registration, professional indemnity and conduct. HMRC addresses status and tax. Neither records market convention, and we are not going to invent it. Where an agency sits in the chain it matters a great deal to who the fee-payer is under Chapter 10, so if there is an agency in your arrangements, that is a question to work through on the actual contracts rather than from a general rule.
What we do with this. We map each of your engagements to the right regime, run and document the determinations that are genuinely yours to make, reconcile the fees that arrive net of PAYE so your company accounts are right, and keep the evidence in a form that survives being asked about later. That work sits inside our locum vet accounts service. Employment status is a tax question and this is general information rather than advice on your contracts.
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It depends on the size of the practice engaging you, not on you. Where the client is small in the private or voluntary sector, Chapter 8 of ITEPA 2003 applies and gov.uk is explicit that the client does not have to determine the employment status of workers engaged through their own intermediaries, because that remains the responsibility of the worker's intermediary. Where the client is medium or large, Chapter 10 applies: the client determines status, must issue a Status Determination Statement, and the fee-payer operates PAYE if the determination is inside. Because 76% of veterinary businesses own just one first opinion practice, most independents are small clients.
Yes, and for a locum working across independents and corporate group sites it is the normal position rather than an edge case. Each engagement is assessed against its own client. Work for a single-practice independent will almost always be Chapter 8, where your own company determines status and carries the risk. Work for any of the six large groups, which own over 60% of UK practices between them, will be Chapter 10, where a Status Determination Statement is issued and the fee-payer may deduct PAYE and National Insurance before paying you. The consequence is that fees taxed at source are not company profit available for dividends.
Not yet. From 6 April 2025 two of the three Companies Act criteria increased: turnover of more than £15 million, up from £10.2 million, and a balance sheet total of more than £7.5 million, up from £5.1 million, with the 50-employee limit unchanged. Those apply to financial years beginning on or after that date. HMRC's manual ESM10006A says the earliest tax year the transitional provision will impact a client is 2027/28, because the earliest possible filing date for such an accounting period is in January 2027. So the higher thresholds do not change who counts as small for engagements being worked today.
It is the best available, with two conditions attached. HMRC says Check Employment Status for Tax is the only tool where it will stand behind the determinations made, as long as the information used remains accurate and is in line with HMRC's guidance. Both halves matter. Remaining accurate is continuing rather than historic, so a determination based on a right of substitution stops holding the first time a practice refuses a substitute. Being in line with guidance means the answers must be defensible against HMRC's Employment Status Manual rather than merely favourable. Save each output with its date, the engagement and the contract version it was run against.
No. HMRC publishes no sector-specific guidance for veterinary locums, so there is no special treatment, agreed industry position or concession to point at. The general test applies: whether the individual would have been an employee of the client had the engagement been direct, assessed on the usual factors of personal service and substitution, control, mutuality of obligation, financial risk, provision of equipment and being in business on your own account. In clinical locum work the interesting ones are control, because clinical judgement is the vet's own professional obligation, and equipment, because the practice supplies almost all of it.
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