It is determined by the reality of the working relationship, not by what the contract says or what both parties would prefer. HMRC looks at control over how the work is done, whether the person must do it personally or can send a substitute, mutuality of obligation, who bears financial risk, who provides equipment, and how integrated they are into your business. Someone who works only for you, on your schedule, with your tools, cannot be made self employed by agreement — and getting it wrong is your liability, not theirs, with HMRC recovering the PAYE and NI you should have deducted, plus interest and penalties, potentially years later. Off-payroll rules add a further layer where a worker supplies through their own company. This is worth getting right before someone starts.