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HMRC internal manual

Claimant Compliance Manual

Migrant workers: Class 2 National Insurance Contributions

Under Section 2(1)(b) of the Social Security Contributions and Benefits Act 1992 a self employed person is defined as gainfully employed other than in employed earners employment. The liability to pay Class 2 Contributions arises under the same Act but is not a condition of self employment for WTC purposes.

For migrant workers in the UK WTC entitlement arises under UK rather than EU law. Although you may wish to question why the customer is not paying Class 2 NI Contributions and point out their obligations to HMRC, if you accept they are self employed this does not stop them being entitled to claim WTC. However if they are not paying Class 2 NI Contributions and do not have an exception certificate you might want to consider if they are genuinely self employed.

However where a Migrant Worker is claiming CTC for children in an OMS entitlement is considered under EU law. Under EU Law, in particular Article 73 of Council Regulation 1408/71 it states that a worker who is living and working in one Member State is entitled to claim family benefit from that Member State in respect of their family member living in an OMS. The family benefit is only available to employed and self employed people and to meet the criteria laid down in 1408/71 they must be insured i.e. paying National Insurance in the host member state. However this is a very complex area and it is not a straight forward as saying the customer must be paying Class 2 NI Contributions. These cases are dealt with by the International Team.