Hi hope you can help

A friend of mine works as a seemstress she is Bulgarian & employs a few members of staff to help her in her busy shop. All her employees work as self employed. In October 2015 she employed a woman who doesnt speak English who lives with her daughter who speaks adequate English. My friend asked this person many times to provide her with her tax & NI number so that she could register her for tax. Cut a long story short she refused to give it to her eventually resulting in my friend refusing to pay her the last months wages until she supplied her with the necessary information required. Apparently this women does not want to give her the necessary information because she lives with her daughter who is getting benefits (housing benefit & child benefits) & these benefits will be reduced if the income is declared.

Does anyone have any ideas what to do here

She's got to let her go, unless she wants to pay her in cash (not a good idea)

The other option is to pay her using an emergency tax code.

Hmrc can advise on this.

If she employs people then I fail to see how they can then be classed as self-employed? If indeed they are self-employed then there is no need to provide any information as they will be responsible for paying their own Tax & NI.

https://www.gov.uk/new-employee/overview

Maybe she is checking that the person has the right to work in this country?

two wrongs dont make a right. Dismiss the person and sort out the proper regulation of her employees as that is what they are. There are 2 classes of employee, one of those is known as "worker" and they have less rights or responsibilities, such as zero hours contract people, casuals, agency staff etc. She will need to read up on it if she is to avoid problems.

Ultimately she will have to pay the person something for the work done but as she clearly doesnt have a clue about employment or contract law she should take proper advice first.

A bit of a late contribution from me ..............

If the workers come into her shop to work, they are employees without a doubt.

YF could easily be held accountable by HMRC for any tax and Class 1 NI Contributions that she's failed to deduct from their earnings.

She should seek advice from a suitably knowledgeable or qualified professional to discuss her options.

I think that there may be big right to work issues with all of the parties involved as well as possible benefits fraud, tax avoidance etc. No doubt the well meaning OP will have passed back the advice and got silence in return