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HMRC internal manual

Claimant Compliance Manual

From
HM Revenue & Customs
Updated
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Particular aspects: work & hours - self-employed customers - types of remunerative work

The type of occupation/trade being declared can give you an indication of whether it is likely to be remunerative.

Retail or wholesale traders, construction workers, plumbers, electricians, taxi drivers and accountants, for example are usually unambiguously engaged in remunerative work, as they clearly work in expectation of payment.

However, claims have been identified where the customer’s has stated they are self employed because they are cleaning their own house or looking after their own children. A customer can not claim to be self employed if they are providing a service for themselves. For example, someone can not claim to be a self employed cleaner if the only person they clean for is themselves as there is no aspect of remunerative work.

Sometimes activity that is commonly associated with leisure or a hobby are claimed to qualify as remunerative work. Some examples of what could fall into hobby/leisure activities but also could be remunerative work are

  • craft work, e.g. soft toys, floral decorations, greetings cards
  • needlework, e.g. soft furnishings, children’s clothes
  • art work, e.g. painting, photography, pottery
  • model making, e.g. dolls’ and wendy houses
  • literary, e.g. writing novels or short stories
  • design, e.g. clothing, software, websites
  • composition, e.g. songs, musical scores
  • cooking, e.g. cake making, jams and preserves.

Further questioning will be necessary to determine whether the activity can be classed as remunerative

You should consider

  • the stage that is has reached, if the person is still developing the idea for example, they are undertaking the activity by have no clients or customers, then there is no element of remunerative work.
  • how organised and how often the activity occurs. For example, if the activity is an occasional one, carried out in response to a seasonal opportunity, for example, making Christmas garlands, it is unlikely to qualify as remunerative work for a whole year. They would only be entitled for the period when they are working and selling the garlands. Then they would have to notify us that they are no longer in remunerative work.
  • then intention to receive payment. If the customer did not carry out the activity with payment as a motive, but simply accepted a spontaneous offer of payment, for example, if a friend asked to buy some jam, then other friends followed suit, it will not qualify as remunerative work.