nmw for spouse working for husband in family home

[maxie]

I have contacted hmrc asking them if it is correct that a spouse working for a husband in the family home is exempt from the national minimum wage rules and was told that this is correct (also confirmed on the direct gov site) I also asked if the same was true for working tax credit, but he wasn't able to tell me but I have discovered in their manuals under the 'remunerative work rules' that as long as a person is actually 'paid' for the job, payment can even be made in 'kind', and for self-employed, work must be done 'in expectation of payment' but this does not necessarily mean 'in profit'. Of course the 16hrs a week rule must still apply. Can anyone clarify this for me? It seems ridiculous that the tax credit rules and the tax rules are not aligned.

[robbob]

Hello maxie

Presuming you are sole trader and not a limited company then you should be ok with the minimum wage issue as advised.
The minimum wage is really only there to protect individuals from exploitation and i don't really see any problems with an individual not being penalised ie being able to claiming tax credits and at the same time only earning £4 per hour say if they work for their spouse. Some self employed family businesses simply take alot of effort to earn very little.
You may also be required to provide evidence that the the work has actually been done as for example if the husband is a taxi driver the tax office is not likley to believe that there would be much spousal work needed for this type of business.

Unfortunately i am not sure what your exact question is in relation to the section below so you may need to rephrase it slightly.

but he wasn't able to tell me but I have discovered in their manuals under the 'remunerative work rules' that as long as a person is actually 'paid' for the job, payment can even be made in 'kind', and for self-employed, work must be done 'in expectation of payment' but this does not necessarily mean 'in profit'. Of course the 16hrs a week rule must still apply. Can anyone clarify this for me?

[maxie]

Hi robob many thanks for reply the last bit I was referring to is this from TCTM02411 (Entitlement to working tax credit)

[b]Work done in expectation of payment:

[b]Work done in expectation of payment means more than a mere hope that payment will be made at a future date. There should be a probability rather than just a possibility that a payment will be made. If a person reasonably expects payments for work done, but the customer or employer does not pay, then the condition is satisfied. However, if the person knew before starting the work that payment was unlikely to be made, the remunerative condition is not satisfied.

A self-employed earner's expectation of payment must be a reasonable one. The claimant must confirm that the work is done in expectation of payment. It does not matter that a self-employed earner might trade at a loss.

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Work for no monetary reward:

If the only payment made is in kind (for example groceries for a person who works as a shop assistant, or free accommodation and farm produce for a farm labourer) the work is for payment.

Alternatively, if no payment in cash or in kind is made and the only `payment` for the work is earnings calculated notionally, the work cannot be treated as `work done for payment or in expectation of payment`.

This seems to cover both self-employed (my husband) and me (employed)

I take this to mean that as long as 'the payment' is seen to be paid then that is acceptable.

My husband is a songwriter working from home. I would be helping with recording/writing lyrics which is an essential part of it.

[robbob]

Hello maxie

Yes as long as you are being paid some salary this should be fine - better to do this than getting your husband to buy the groceries as all the fruit will likely be past its best

[maxie]

thank you robob for quick reply. Much appreciated.