Blanket IR35 Determinations and the Risks for Clients

18 August 2026 · The outsideir35jobs.com Editorial Team

Primary sources last checked 18 Aug 2026

Blanket IR35 determinations and why they carry risk for clients

When a business needs to assess IR35 status for dozens or hundreds of contractors at once, it can be tempting to take a shortcut: label every contractor in a certain role as "inside" or "outside" IR35 without looking at each engagement individually. HMRC calls this a blanket determination, and its current guidance is clear that this approach does not satisfy the legal duty of reasonable care.

This matters to contractors as much as to clients. If a hiring organisation applies a role-based blanket approach rather than assessing individual working practices, the resulting Status Determination Statement (SDS) may not stand up to scrutiny, and the client itself can end up carrying the tax risk.

What counts as a blanket determination

HMRC's guidance describes a blanket determination as one made for a group of workers who have different terms, conditions, or working practices, without HMRC's expected level of individual consideration.[1][3] In practice, this often looks like a client deciding that "all contractors doing job X are inside IR35" or "everyone engaged through a personal service company is outside IR35", purely on the basis of role title or engagement type, rather than on how each contract actually operates.

HMRC says plainly that it does not accept blanket determinations.[1] The off-payroll working rules require a determination for each individual engagement, based on the specific facts of that engagement: how the work is actually carried out, not just what the contract or job title says.

Why "reasonable care" is the key test

Under the off-payroll working rules, the client responsible for the determination must take reasonable care when deciding whether a worker would have been an employee if engaged directly.[8] HMRC defines reasonable care as acting in the way a prudent and reasonable person in the client's position would act.[3][8]

A blanket, role-based determination fails this test almost by definition, because it disregards the individual facts of each engagement, such as the degree of control the client exercises, whether there is a genuine right of substitution, and how integrated the contractor is into the client's organisation. These are the same kinds of factual questions the courts have focused on in status cases, including the Supreme Court's PGMOL judgment on mutuality of obligation and control, which underlines why substitution and control (rather than a simple checklist) sit at the heart of status reasoning.

HMRC's guidance is explicit: a client that has applied blanket determinations will not have taken reasonable care in making status determinations.[1][8]

What happens when reasonable care is not taken

The consequences fall on the client, not just on paper but financially. HMRC's Employment Status Manual states that if the client fails to take reasonable care, responsibility for deducting tax and National Insurance contributions, and for paying the apprenticeship levy, remains with the client.[8] Normally, using the correct SDS process can shift certain liabilities down the labour supply chain, but that protection depends on the client having taken reasonable care in the first place.

There is a further sting: HMRC says blanket determinations may be treated as deliberate behaviour when it considers penalties.[1] Deliberate behaviour attracts materially higher penalty exposure than a simple mistake, so a client that relies on a blanket approach is not only risking the loss of liability protection, but potentially higher penalties as well.

What this means in practice for contractors

If you are a limited-company contractor and the client's SDS looks like it has been generated for an entire role or team rather than for your specific engagement, that is a signal worth noting. It does not automatically mean the determination is wrong for your circumstances, but it does mean the process behind it may not meet HMRC's reasonable care standard, which could matter if the determination is ever challenged.

The CEST tool, if used, does not remove this risk either: HMRC treats CEST outputs as one input to the process, not as determinative in themselves, so a blanket exercise run through CEST for a whole cohort of workers does not cure the underlying problem. A properly conducted SDS or contract review, focused on individual working practices, is evidence provided by the client of how they reached their conclusion, not proof of status in itself.

If you have concerns about how a determination was reached, an IR35 contract reviewer or specialist contractor accountant can assess your actual working practices against the individual facts, rather than the role-based label applied by the client. Employment rights questions, separate from tax status, sit with the Fair Work Agency (FWA) rather than with HMRC or the platform.

For contractors currently assessing new opportunities, it is worth checking how each client's status determinations are produced before signing. You can browse outside-IR35 contracts and compare day-rate benchmarks on this site, and read our other guidance articles on status determinations and the off-payroll rules for more background.

Sources

This platform does not determine, verify, or warrant IR35 status; the SDS is the client's legal responsibility. Contractors should take their own advice and consider IR35 insurance.