Glossary · UK
What is IR35 Blanket Determination?
The unlawful practice of an end client applying a single IR35 status decision to an entire group of contractors without individually assessing each engagement, which the off-payroll working rules explicitly prohibit.
Full Definition
An IR35 blanket determination occurs when a medium or large private-sector end client (or any public-sector body), responsible under the off-payroll working rules for assessing the IR35 status of contractors it engages through personal service companies, applies a single status decision -- almost always "inside IR35" -- to an entire category of contractors without carrying out the individual, engagement-specific assessment the legislation actually requires. Common examples include a business declaring that all contractors working through a personal service company will be treated as inside IR35 regardless of role, or applying a blanket "inside" determination to every contractor engaged via a particular agency or on a particular project, rather than assessing each contractor's actual working practices, degree of control, right of substitution, and mutuality of obligation. The off-payroll working rules require the end client to take "reasonable care" in reaching each status determination, and HMRC guidance and case law have made clear that a blanket determination applied without regard to the specific facts of an individual engagement does not meet this reasonable care standard; if reasonable care is not taken, the end client itself becomes liable for the associated tax and National Insurance, rather than the liability transferring down the labour supply chain, which is precisely the risk blanket determinations are usually designed by cautious employers to avoid, but fail to. Widespread blanket determinations followed the 2021 extension of the off-payroll rules to the private sector, as many large organisations, wary of the compliance burden and potential liability of assessing hundreds or thousands of contractors individually, opted for a risk-averse blanket "inside" policy or, in some well-publicised cases, refused to engage personal service company contractors at all. A contractor who believes they have been wrongly given a blanket "inside IR35" determination, rather than a role-specific assessment reflecting their actual working arrangement, can challenge the determination through the end client's mandatory Status Disagreement Process, which the client must operate and respond to within 45 days, providing either a revised determination with reasons or an explanation of why the original determination stands. Genuinely blanket, unreasoned determinations are one of the most commonly cited grounds for a successful challenge, though contractors report mixed success in practice getting a truly individualised reassessment once an organisation has adopted a blanket policy across its entire contractor population.