Whether you're employed or self-employed depends on the terms and conditions of your work. It's important to know your employment status because it affects employment and benefit rights, and how you pay tax and National Insurance.
On this page:
You can usually work out your employment status by asking a few straightforward questions.
You are probably self-employed if you:
You are probably employed if you:
You can also be employed and self-employed at the same time, perhaps by working for an employer during the day and running your own business in the evenings. Think about each contract separately - you may find that you are self-employed for one but employed for another.
There's no legal definition of employment or self-employment, so if there's doubt about someone's employment status the decision is made by referring to previous judgments - known as 'case law'. Whether you are employed or self-employed depends upon the facts of your working arrangements, what your contract says, or a combination of both.
If, after reading the guidance above, you're still unsure about your employment status you can use HM Revenue & Custom’s (HMRC) online Employment Status Indicator tool to help you decide by following the link below. It's free, easy to use and will help you work out whether you are employed or self-employed in all but the most complex cases.
If you need more help contact the Taxes Helpline on Tel 0845 3000 627. Lines are open from 8.00 am to 8.00 pm, Monday to Friday, and from 8.00 am to 4.00 pm on Saturday.
You are responsible for your own tax and National Insurance contributions.
This means telling HM Revenue & Customs (HMRC) about your income
by filling in a Self Assessment tax return.
You should register for tax and National Insurance with HMRC as soon as you start working for yourself. If you delay registering you may have to pay penalties.
Depending on what type of National Insurance contributions you pay, you may lose the right to certain benefits, statutory payments, employment rights and the additional State Pension.
If you are employed your employer is responsible for deducting and paying your tax and National Insurance contributions through the PAYE (Pay As You Earn) system. You are also entitled to certain rights and benefits, such as maternity or paternity leave, sick pay, Jobseeker's Allowance if you lose your job and a State Pension - including the additional State Pension - when you retire.