HC Deb 25 March 2003 vol 402 cc130-1W
Mr. Cousins

To ask the Chancellor of the Exchequer what steps he is taking to secure a common definition of employment status for tax, national insurance, tax credit and VAT purposes. [104725]

Dawn Primarolo

There is no statutory definition of employment or self-employment for income tax, national insurance, tax credits or VAT. The courts have considered the question on many occasions and have indicated the kind of factors which need to be taken into account in deciding whether a particular engagement is one of employment or self-employment. The common thread running through the case law is that no single factor is conclusive; for each engagement the whole picture needs to be looked at in the light of all the facts.

The Inland Revenue interprets the courts' views consistently for the purposes of determining employment status for tax, national insurance and tax credits. Where the Inland Revenue has advised on a person's status that determination will usually apply for all three purposes. Customs and Excise generally follow the same interpretation and thus a consistent determination would apply for VAT purposes also.

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