Part and parcel is one of the older IR35 status tests, but it still appears in tribunal decisions as judges try to understand how closely a contractor has been drawn into a client’s organisation.
It does not get as much attention as control or mutuality of obligation, yet it often supports the overall picture of how an engagement actually worked in practice.
If a contractor becomes so closely involved in the client’s internal structure that they start to look like part of the organisation, that is usually a pointer towards employee-type behaviour.
If client and contractor remain clearly separate entities, both in terms of working practices and expectations, this is more consistent with an outside-IR35 business-to-business relationship.
Read more in IR35 employment status tests explained and our guide to the right of substitution.
What does “part and parcel” mean in an IR35 context?
Integration into a client’s organisation often builds up over a period of time.
A contractor might start by delivering a defined project, but then gradually take on more responsibilities that would typically fall to a permanent member of staff.
They might begin to represent the client in meetings, manage employees, or take decisions that go beyond the original scope of work.
Importantly, none of these things automatically puts an engagement inside IR35.
Tribunals look at patterns of behaviour rather than isolated incidents.
What they want to know is whether, viewed over the whole period, the contractor was treated and perceived as a member of the staff, or as an external provider delivering a specific service.
Part and parcel is often discussed in the context of the classic Ready Mixed Concrete test.
In Ready Mixed Concrete (South East) Ltd v Minister of Pensions, one question was whether the worker was integrated into the business or remained an accessory to it.
That theme has carried through into later decisions, including IR35 cases in which judges have commented on how closely contractors were woven into the client’s organisation.
Examples of integration in practice
Examples of part and parcel behaviour can vary widely between sectors, but they often include things like:
- being included in staff meetings that do not relate directly to the contracted work
- appearing on internal organisation charts, staff lists or standard distribution lists
- carrying out supervisory or line management duties over employees
- being responsible for staff appraisals, rotas or internal processes
- covering work that would usually be done by employees during absences
Judges have raised this point in some high-profile IR35 cases. In Christa Ackroyd Media Ltd v HMRC, integration into the BBC’s organisation was one of the factors pointing towards employment.
In Hall v Lorimer, the focus was on whether the worker was in business on his own account, but the level of integration across multiple clients was a relevant factor.
In more recent cases, such as HMRC v Professional Game Match Officials Ltd (PGMOL) and HMRC v Atholl House Productions Ltd, the courts also considered how far individuals had become part of the engaging organisation. Even when other factors, such as control and mutuality, were finely balanced.
These decisions underline that part and parcel is not a standalone test. It supports or weakens the picture created by the other key status factors.
Signs that a contractor is not part and parcel of an organisation
There are also clear signs that a contractor has not become integrated into the client’s organisation.
Here are a few examples:
- only attending meetings that relate directly to the contracted work
- not being given staff management or HR responsibilities
- using their own equipment, where this is practical
- being excluded from staff benefits, appraisals and internal schemes
- keeping involvement limited to the agreed deliverables rather than general “team” duties
Contractors who remain focused on the project they were engaged to deliver and are not pulled into the broader functions of a business are less likely to be seen as part and parcel of the client’s organisation.
HMRC guidance and part and parcel
HMRC still refers to integration in the Employment Status Manual, although it is not always labelled as “part and parcel”.
The guidance addresses whether an individual is an integral part of the business or more like an accessory.
HMRC, however, tends to place greater emphasis on control, personal service, and mutuality of obligation.
This means part and parcel is often used as supporting material rather than the main plank of a status argument.
If HMRC believes a contractor is inside IR35 and can also show they were heavily integrated into the client’s structure, that will usually be treated as additional evidence rather than the primary reason for the determination.
Why integration can creep up on you
One challenge with the concept of ‘part and parcel’ is that it rarely happens in a single moment.
A contractor may initially be engaged to deliver a pre-defined piece of work.
Over time, people inside the client may start asking for help with additional tasks.
The contractor may be invited to more general meetings or asked to step in when permanent staff are absent.
None of these examples will feel like a big deal at the time.
However, they can leave the contractor looking very similar to a traditional employee if the client-worker relationship is reviewed months or years later.
From an IR35 perspective, it is worth consciously keeping an eye on the potential for the scope of a contract to drift.
Contractors who want to maintain an outside IR35 position should be careful not to assume responsibilities that naturally belong to permanent staff.
How part and parcel integrates with other IR35 tests
Part and parcel fits into the same wider cluster of status factors as control, mutuality, personal service and financial risk.
It helps to show how the relationship works day to day and how the contractor is perceived by the client and by colleagues.
On its own, integration will not decide the outcome of an IR35 case, but when several other indicators already point in one direction, it can reinforce the conclusion.
For a wider view of how the main employment status tests fit together, see our guide IR35 employment status tests explained.