The short answer
- What the agreement calls it does not settle the questionHMRC looks at how the work happens in practice. A line in a contract saying somebody is self-employed is part of the picture, and it is not the answer on its own.
- The test runs in three stages, in orderFirst, is the carer paid for work they have to do themselves. Second, is there enough control over what is done, where, when and how. Third, do the rest of the terms read like employment.
- If the answer is wrong, the cost falls on the familyHMRC can assess the tax and National Insurance that should have been paid for the last four years, longer if it decides the mistake was careless, and a claim for unpaid holiday can follow.
- Carers on PrimeCarers are self-employed, and the agreement says howThey set their own rate, invoice for the hours worked, may send a suitable substitute, and are responsible for their own tax. You are not their employer and neither is PrimeCarers.
PrimeCarers is an introductory service. It is not a care agency, it holds no CQC registration, and it does not supervise or direct the carers who use it. This page explains what that means for a family paying one.
What changes
What changes depending on which one it is
Employment status decides who pays the tax, who is owed holiday, who has to be insured, and who answers if something goes wrong. It is worth seeing the three positions side by side before reading the test, because the test is asking which of these columns you are in.
| Self-employed | Worker | Employee | |
|---|---|---|---|
| Income tax and National Insurance | The carer works out and pays their own, through Self Assessment | Normally deducted by whoever pays them, through PAYE | You deduct it and pay it to HMRC through PAYE |
| Paid holiday | None; the rate covers the weeks they are not working | 5.6 weeks a year, capped at 28 days | 5.6 weeks a year, capped at 28 days |
| Minimum wage | Does not apply; the carer sets their own rate | Applies | Applies |
| Sick pay and notice | Neither; cover is agreed between you and the carer | May be entitled to statutory sick pay, but not to a statutory notice period | Statutory sick pay, and a statutory minimum notice period |
| Unfair dismissal | Does not apply | Does not apply | Applies once the qualifying service is met |
| Insurance while the work is done | The carer holds their own cover | Employer’s liability insurance is yours to arrange | Employer’s liability insurance is yours to arrange, for at least £5 million |
| Who answers to HMRC for the tax | The carer | You, as the payer | You, as the employer |
Income tax and National Insurance
- Self-employed
- The carer works out and pays their own, through Self Assessment
- Worker
- Normally deducted by whoever pays them, through PAYE
- Employee
- You deduct it and pay it to HMRC through PAYE
Paid holiday
- Self-employed
- None; the rate covers the weeks they are not working
- Worker
- 5.6 weeks a year, capped at 28 days
- Employee
- 5.6 weeks a year, capped at 28 days
Minimum wage
- Self-employed
- Does not apply; the carer sets their own rate
- Worker
- Applies
- Employee
- Applies
Sick pay and notice
- Self-employed
- Neither; cover is agreed between you and the carer
- Worker
- May be entitled to statutory sick pay, but not to a statutory notice period
- Employee
- Statutory sick pay, and a statutory minimum notice period
Unfair dismissal
- Self-employed
- Does not apply
- Worker
- Does not apply
- Employee
- Applies once the qualifying service is met
Insurance while the work is done
- Self-employed
- The carer holds their own cover
- Worker
- Employer’s liability insurance is yours to arrange
- Employee
- Employer’s liability insurance is yours to arrange, for at least £5 million
Who answers to HMRC for the tax
- Self-employed
- The carer
- Worker
- You, as the payer
- Employee
- You, as the employer
Worker and employee rights from gov.uk, checked 14 September 2026. The middle column exists because employment law and tax law do not always draw the line in the same place.
A family that books a self-employed carer for care at home from a private carer pays for the hours worked and runs no payroll, and that is the first column. The middle column matters because employment law and tax law do not always draw the line in the same place. Somebody can be self-employed for tax and still count as a worker for employment law, since that test asks whether they agreed to do the work personally for someone who is not their client or customer. A carer with several clients, setting their own rate and able to send a substitute, sits well clear of it. A carer doing twenty hours a week for one household, on hours that household sets, is closer to the line than the wording of the agreement suggests.
If you already know you want to take somebody on as an employee, employing a private carer sets out the duties and the 2026/27 figures, and can I employ a private carer? compares the three ways of arranging care.
The HMRC test
The three stages HMRC works through, in order
HMRC has applied the same three-stage test since a 1968 case about a concrete lorry driver, and it still works through the stages in order. The first two are pre-conditions: if either is missing, the arrangement is not employment. The third weighs everything else together.
Stage one
Personal service, in return for payment
Is the carer paid for work they have to carry out themselves?
HMRC calls this the wage-work bargain: one side agrees to pay, the other agrees to do the work personally. It is a pre-condition, so if it is missing, employment cannot arise at all.
Points towards employment
The carer has to attend in person. If they cannot come, the visit does not happen and nobody else covers it.
Points towards self-employment
The carer may send another suitable carer in their place, and arranges and pays that person themselves.
A real right to send a substitute is one of the clearest signs of self-employment. Having to do the work personally is a pointer the other way, and HMRC says it is not conclusive on its own, because plenty of self-employed people are engaged for their own skill.
Stage two
Control over the work
Is there enough control over what is done, where, when and how?
HMRC looks at all four of those and asks who has the right to decide, rather than who happens to decide day to day. Control is the second pre-condition.
Points towards employment
You set the days and the hours and can change them, you say where the work happens, and you tell the carer how each task is to be done.
Points towards self-employment
You agree what needs doing and when you need somebody there. The carer decides how to do it and fits you in alongside other clients.
A care plan and a medication schedule are information a carer needs, not a set of instructions about method. Telling a trained carer how to transfer somebody, and changing the rota whenever it suits you, is a different thing.
Stage three
Everything else, weighed together
Do the rest of the terms read like a contract of employment?
The third stage is an evaluative exercise. Mutuality and control come back in alongside every other term, and HMRC treats the terms agreed between the two of you as central to it.
Points towards employment
A fixed sum every week whether visits happen or not, paid holiday, sick pay, equipment supplied for them, and no other clients.
Points towards self-employment
Their own rate, an invoice for the hours worked, their own insurance and equipment, several clients at once, and their own tax to sort out.
No single item decides it. HMRC weighs them together and asks whether the picture is somebody in business on their own account or somebody working in your household on your terms.
The three stages come from Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497, which HMRC still works through in that order.
Check the status with HMRCTwo things about the order catch families out. The first is that stage one and stage two are conditions which have to be met before anything else matters, so a real right to send a substitute, or an arrangement where you have no say over how the work is done, can end the question early. The second is that stage three is a weighing exercise rather than a scorecard. There is no number of boxes to tick, and HMRC has said the terms the two of you agreed stay central to it, which is why a written agreement is worth having even though it does not decide the answer by itself.
You can read the case HMRC relies on, and its own guidance on each stage, in the Employment Status Manual.
In a care arrangement
What each stage looks like when the work is care at home
Care at home is harder to read against the test than a building job or a set of accounts. The work happens in your house, on a routine you care about, for somebody you love. Each stage tends to turn on one of these four things.
The rota
Stage two: control
How the task is done
Stage two: control
Cover when the carer cannot come
Stage one: personal service
How the money moves
Stage three: everything else
Checking it yourself
How to check the status, and keep the answer
This takes about an hour and costs nothing. It is worth doing before the first visit rather than after a year of them, because the record you keep is what protects you if the arrangement is ever questioned.
- 1
Write down how the work will happen
Half an hourWho chose the hours and who can change them. Who decides how each task is done. What happens if the carer is ill. Who set the rate, and how you will be billed. Whether they have other clients, and whose equipment they use. - 2
Run HMRC’s status tool
About ten minutes, freeCheck Employment Status for Tax, known as CEST, asks those questions and gives HMRC’s view. HMRC says it will stand by the result as long as the information you gave stays accurate and is in line with its guidance. Anyone can use it, including the carer. - 3
Save the result
The same dayPrint or download the answer and keep it with the agreement and the invoices. If HMRC ever asks, the saved result is what shows the position you took and the facts you took it on. - 4
Put the answer into the written agreement
Before the first visitWrite down the rate, what the carer is being asked to do, what happens when they cannot come, who provides equipment, and the notice on either side. The agreement does not decide status on its own, and HMRC reads the terms you agreed as part of the third stage.
The tool lives on gov.uk under Check employment status for tax. Run it again if the arrangement changes in a way that matters, for example if the carer stops taking other clients, or if hours that used to be agreed between you start being set by you alone. If the answer comes back as employment and you are content with that, employing a private carer has the full list of what follows, with the 2026/27 figures.
If the answer is wrong
What follows if the arrangement turns out to be employment
This is the part worth knowing before you agree anything, because the cost of an incorrect label does not land on the carer. It lands on the person who paid them.
- Something prompts it
The arrangement comes under question
A tax return, a disagreement when the arrangement ends, or a claim the carer brings afterwards can each put the status in front of HMRC or a tribunal. The question is rarely raised while everything is going well.
- Up to four years back
HMRC assesses the tax and National Insurance that should have been paid
The ordinary time limit for an assessment is 4 years from the end of the tax period. It extends to 6 years where HMRC decides the mistake was careless, and 20 years where it decides the behaviour was deliberate.
- On top of that
Interest, and a penalty if HMRC decides you were careless
Interest runs on tax that was due and not paid. Whether a penalty follows, and how large it is, depends on the view HMRC takes of the behaviour and on how much help it gets working the position out.
- Within three months
A claim for unpaid holiday, or for the minimum wage
Almost anybody classed as a worker is entitled to 5.6 weeks of paid holiday a year, capped at 28 days, and to the minimum wage. A tribunal claim usually has to be started within three months of the problem, and Acas early conciliation comes first.
- From the first day
Employer’s liability insurance, needed from the start
Employer’s liability insurance is required as soon as you become an employer, for at least £5 million of cover, and the fine is up to £2,500 for every day you are not properly insured. Close family members are exempt from the requirement. A carer is not a close family member.
None of that is a reason to panic about an arrangement that has been running for years. It is a reason to check, write the answer down, and keep paying the way the answer says. The figures above come from HMRC's assessment time limits, gov.uk on worker rights and gov.uk on employers' liability insurance, all read on 14 September 2026.
The PrimeCarers model
How a booking on PrimeCarers is set up
Carers who use PrimeCarers are self-employed, and the written agreement between the carer and the family is built around the three stages above rather than around the label. The terms below are grouped by the part of the test each one speaks to.
What the standard agreement between you and the carer says
0 of 10 ticked
Personal service
Control
The money
Obligation on either side
Where PrimeCarers sits
The full terms are on the site as the client and carer agreement, and it is worth reading before the first visit rather than after a problem. When you are ready to see who is available, you can search for carers near you and compare their rates without paying anything or committing to anybody. Background checks for private carers sets out exactly what each check covers and what it does not.
Employing someone yourself
When employing a carer yourself is the better answer
Employing a carer directly is a reasonable choice rather than a mistake. For some households it is the right arrangement, and where a council direct payment pays for the care it is often the one the funding assumes. It only goes wrong when a family ends up there without meaning to.
Reasons it can be the right arrangement
- You want one person on hours you set, with the continuity that comes from that
- The care is funded by a council direct payment, which is often designed around the person becoming an employer
- You need the carer to work in a way you direct, for example alongside a family member with a fixed routine
- You are willing to run a payroll, or to pay somebody to run it for you
What to have in place before the first day
- A right to work check, and sight of an enhanced DBS certificate the carer has obtained themselves
- Employer’s liability insurance, in place from the first day rather than the first problem
- A written statement of the main terms, given to the carer on day one
- Registration with HMRC as an employer, and a decision about who runs the payroll
- A saved copy of the status answer, so the position is recorded before anybody disagrees about it
If the money is coming from the council, ask the direct payments team what they will fund alongside the wages: payroll support and insurance are often part of the package, because both become necessary the moment somebody becomes an employer. Local authority funding explains how to ask for an assessment and what a direct payment is. If you would rather choose the carer yourself without taking on the payroll, care agency or private carer sets the routes beside each other, and do self-employed carers need to be registered with the CQC? answers the regulation question that usually comes next.
Questions
Questions families ask about a carer's employment status
Either is possible, and it depends on how the work happens rather than on what the arrangement is called. HMRC asks three questions in order: whether the carer is paid for work they have to carry out themselves, whether there is enough control over what is done and where, when and how, and whether the rest of the terms read like employment. Carers booked through PrimeCarers are self-employed: they set their own rate, invoice for the hours worked, may send a suitable substitute and pay their own tax.
No. A written agreement is part of the picture and HMRC treats the terms you agreed as central at the third stage, so it is worth having. It does not decide the answer on its own. If you set the hours, direct how the work is done and pay a fixed sum whether or not visits happened, the label will not hold.
Use HMRC's free tool, Check Employment Status for Tax, known as CEST. It asks about the hours, the control, the cover arrangements and the money, and gives HMRC's view in about ten minutes. HMRC says it will stand by the result as long as the information you gave stays accurate and is in line with its guidance. Save or print the answer and keep it with the agreement. Check employment status for tax on gov.uk.
HMRC can assess the income tax and National Insurance that should have been paid, and interest on it. The ordinary time limit for an assessment is 4 years from the end of the tax period, extending to 6 years where HMRC decides the mistake was careless and 20 years where it decides the behaviour was deliberate. A separate claim for unpaid holiday or the minimum wage can be brought at a tribunal, usually within three months of the problem.
No. Someone in business on their own account is not entitled to either, and their rate is set on that basis. Paid holiday of 5.6 weeks a year, capped at 28 days, belongs to workers and employees. If you find yourself paying a carer through a holiday anyway, and expecting them there on set hours, look at the status question again.
Yes. Status is decided for each engagement, not for the person. A carer can run a business with several clients and also take one job where somebody sets their hours, directs the work and pays them a wage. Each arrangement is looked at on its own terms.
No, and neither is PrimeCarers. You agree the visits directly with a self-employed carer under a written agreement, they invoice for the hours worked, and they are responsible for their own income tax and National Insurance. PrimeCarers introduces you to the carer and handles the invoicing administratively. It does not supervise or direct the carer, is not a care agency and holds no CQC registration.