With the shortage of HGV drivers reported in the news, Richard Curtis reviews some of the tax issues facing haulage operators and their workers.
Although Brexit appears to be shouldering the bulk of the blame for the present shortage of lorry drivers, the changes to the IR35 ‘off-payroll working’ rules (in ITEPA 2003, Pt 2 Ch 8) are also implicated.
Effect of IR35 changes
Since April 2021, public authorities and medium and large-sized companies (i.e., those that meet at least two of the following three conditions: an annual turnover of more than £10.2 million; a balance sheet total of more than £5.1 million; and more than 50 employees) must decide whether a worker operating through a personal service company (PSC) is caught by IR35. Making the wrong decision will leave the paying company responsible for any underpaid income tax and National Insurance
