Can a sponsored dentist be self- employed?

A common question for dental practices holding a sponsor licence is whether a dentist sponsored under the Skilled Worker route must be employed through PAYE, or whether they can instead work as a self-employed dental associate.

This is particularly relevant in dentistry, where self employed associate arrangements are commonplace.

The short answer is: yes, a sponsored dentist can potentially be self-employed.

However, changing a sponsored dentist from employment to self-employment is not simply a matter of changing their contract. The practice must continue to comply with its sponsor duties and the arrangement must continue to satisfy the requirements of the Skilled Worker route.

Does the Home Office allow sponsored workers to be self-employed?

Yes.

The Home Office’s Workers and Temporary Workers: guidance for sponsors – Part 2: Sponsor a worker expressly recognises circumstances in which a sponsored worker is self-employed.

The guidance provides that where the worker is self-employed, there must be a genuine contract for employment or services between the sponsor and the worker.

The contract must contain specified information, including:

• the names and signatures of the parties;
• the start and end dates of the contract;
• details of the work the worker has agreed to undertake; and
• the amount the worker will be paid.

This is important because it confirms that being self-employed does not, by itself, prevent an individual from being a sponsored worker.

The Home Office’s Appendix D record-keeping guidance similarly refers expressly to circumstances where a sponsor engages a sponsored worker in a self-employed capacity.

The Skilled Worker sponsor guidance also recognises that there may be circumstances where PAYE is not required because, for example, the sponsored worker is self-employed.

What does this mean for dental associates?

For dental practices, this means that a dentist does not necessarily have to be a PAYE employee simply because they hold a Skilled Worker visa.

A practice may potentially sponsor a dentist who is engaged under a genuine self-employed associate agreement.

Likewise, it may potentially be possible for a dentist who is already sponsored by a practice as an employee to subsequently move to a self-employed associate arrangement.

However, practices should be cautious about treating the Home Office’s recognition of self-employment as meaning that any self-employed associate arrangement will automatically be acceptable.

The underlying Skilled Worker requirements still apply.

The salary requirement still matters

One of the key issues is remuneration.

Sponsored workers must continue to satisfy the applicable Skilled Worker salary requirements. This can require particular attention in dentistry because associate dentists are often not paid a conventional fixed annual salary.

The practice therefore needs to consider whether the proposed remuneration structure allows it to demonstrate that the sponsored dentist continues to receive the level of pay required under the Immigration Rules.

A practice should not assume that because an associate’s anticipated annual earnings exceed the relevant salary threshold, the immigration salary requirements are automatically satisfied. The particular remuneration arrangements and the rules governing which payments can be counted should be considered carefully.

The relationship with the sponsor must remain genuine

The practice must also remain the genuine sponsor of the dentist.

Moving the dentist onto a self-employed contract should not result in an arrangement where the practice no longer has meaningful responsibility for the sponsored role.

The associate agreement, the reality of the working relationship and the information held by the Home Office should therefore be consistent with one another.

This is particularly important because sponsor compliance is concerned not only with what a contract calls the relationship, but with the actual circumstances in which the sponsored worker performs their role.

What about PAYE?

A common concern is that removing a sponsored dentist from PAYE will automatically cause a sponsorship problem.

The Home Office guidance recognises that PAYE may not be applicable where a sponsored worker is genuinely self-employed. The absence of PAYE is therefore not necessarily fatal to sponsorship.

However, the practice should be able to explain and evidence why PAYE is not being operated and retain appropriate documentation as part of its sponsor records.

There is also a separate question as to whether the dentist is genuinely self-employed for tax and employment-status purposes. Immigration permission to engage a worker on a self-employed basis should not be treated as determining their employment or tax status.

Can we simply change an existing sponsored dentist to self-employed?

Practices should avoid making the change without first reviewing the sponsorship position.

Before moving an existing sponsored dentist from employment to a self-employed associate arrangement, the practice should consider:

1. whether the new associate agreement constitutes a genuine contract for services;
2. whether the sponsored role and duties remain consistent with the role for which the dentist is sponsored;
3. whether the new remuneration arrangements continue to satisfy the relevant Skilled Worker salary requirements;
4. whether the working hours, work location or other relevant circumstances are changing;
5. whether the change needs to be reported through the Sponsor Management System; and
6. whether the proposed arrangement creates any wider employment-status or tax issues.

Depending on the extent of the changes, it may also be necessary to consider whether the changes can simply be reported by the sponsor or whether further immigration action is required.

A practical example

A dental practice currently sponsors a dentist as a PAYE employee. The practice and dentist subsequently agree that the dentist will become a self-employed associate and will be paid according to an agreed Units of Dental Activity rate together with a percentage of private treatment income.

The fact that the dentist will become self-employed does not automatically bring their sponsorship to an end.

However, before implementing the change, the practice should review the associate agreement and proposed remuneration structure against the Skilled Worker requirements. It should also establish what sponsor reporting is required and ensure that its sponsor records accurately reflect the new arrangement.

Only once the immigration and sponsor compliance implications have been considered should the practice implement the change.

The key takeaway for dental practices

Self-employment and Skilled Worker sponsorship are not necessarily incompatible.

The Home Office guidance expressly recognises that sponsored workers can, in appropriate circumstances, be self-employed.

For dental practices, this means that a sponsored dentist may potentially work under a self-employed associate agreement rather than a traditional PAYE employment contract.

The important point is that changing the contractual label does not remove the practice’s sponsor obligations.

Before changing an existing sponsored dentist from employed to self-employed status, practices should review the associate agreement, remuneration arrangements and sponsored role, and consider any Home Office reporting requirements.

Getting those points right before making the change can significantly reduce the risk of problems arising during a future Home Office sponsor compliance audit.

This article is intended as general information only and does not constitute legal advice. Immigration rules and Home Office sponsor guidance are subject to change, and advice should be obtained on the particular circumstances of each case.