Peculiar NI treatment for Self Employed cleaners
A client of ours, a cleaning company, has recently been visited by HMRC, with the main intention of their visit appearing to be to ensure that self employed cleaners are indeed self employed, rather than being employees. This client has a number (a majority, even) of employees, but also uses a few sub-contractor self employed cleaners. HMRC have, it would appear, agreed that these latter individuals are correctly treated as being self employed.
However, the inspector has now pointed the client to HMRC guidance ESM4018 which refers to the NI treatment of self-employed sub-contractors who provide cleaning services on behalf of a contractor, and the guidance seems to state quite plainly that, even though being self-employed, the contractor is required to treat them as employees as far as National Insurance is concerned, though not for tax.
How does this work in practice, and are there any arguments against adopting this treatment?
Any answers greatly received.
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