Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Claimant Compliance Manual

From
HM Revenue & Customs
Updated
, see all updates

Particular Aspects: Work & Hours - Self-employed Customers - Particular Trades

Some types of activity present particular difficulties for calculating the number of hours worker. There include

Bed and Breakfast (B&B) trades

In some cases this trade will be seasonal or infrequent. You are most likely to meet this situation where the customer advertise the availability of B&B by a sign in the window or at the end of the road, so business is dependant on passing trade.

Because there will be a degree of planning and preparation involved, there will need to be a permanent supply of appropriate food and drink, bedding etc, available at all times. It would be harsh to restrict the number of hours worked only to those when the customer is actively engaged in activities such as cooking, bed making or cleaning the let rooms. On the other hand, it would be over generous to count in all the hours the customer spends at the property, on the grounds s/he must always be on hand just in case a customer arrives.

You will need to consider each case on its own merits, taking into account factors such as the level of occupation over the year of the let rooms. Where there has been a reasonably steady amount of trade over the year, it is likely that the customer will have devoted more hours to running the business than where guests have been few in number and infrequent.

Artists, writers and craftsmen

Creative activities are notoriously time consuming, and the amount of work accomplished each day can seem disproportionately small for the amount of effort spent. Likewise, the amount of money received for the products may seem to represent a very poor return for the labour. In cases of this kind the issue is not likely to be the number of hours worked, but whether the activities qualify as remunerative work.

Property Renovation

If the customer states that she/he is engaged in renovating a property with a view to selling it, you will need to consider factors such as

  • when and in what circumstances the property was acquired
  • how long the renovation has been taking place, and
  • when it is expected to be complete

If the customer’s motive is genuinely to sell the property at a profit she/he will be able to demonstrate a degree of planning and organisation

Door to Door Sales, as agent, of a company’s products (e.g. cosmetics or household goods) for commission

Typically, the agent delivers a catalogue to the customer’s door, returning to collect any orders, and delivering the goods direct some time later. Agents often start off in a small way, perhaps fitting their deliveries and collections into school hours. Sometime the activities develop into a recognisable business but more often the income they generate remains low. Customer’s may inflate the time they spend on making deliveries and collections, and on completing paperwork, in order to meet the qualifying hours test. Remember that this type of activity tends to occur in peaks - typically, the catalogue is delivered once a month, or even less frequently. So even if the customer devotes a considerable amount of time on it over the course of a single week, she/he may spend very little on it during the rest of the month. Factors such as these, along with details of the numbers and addresses of customers (in most cases, the majority are likely to live close to the agent), should enable you to reach a conclusion on whether the hours allegedly worked are realistic.