Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Shared parental leave
    • Redundancy
    • Maternity & Paternity
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Shared parental leave
    • Redundancy
    • Maternity & Paternity
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+

TaxGig economyLatest News

Taxation system similar to PAYE proposed for gig economy workers

by Ashleigh Webber 23 Jul 2018
by Ashleigh Webber 23 Jul 2018 Gig economy workers, for example those working in food delivery, could pay tax as they earn
Gig economy workers, for example those working in food delivery, could pay tax as they earn

The Office for Tax Simplification (OTS) has suggested gig economy firms should deduct tax from the earnings of self-employed workers in a system similar to PAYE.

The OTS said it was concerned by the tax implications of the rise in self-employed workers and asked the government whether online platforms, such as taxi or food delivery firms, could deduct tax from earnings to “fulfil the tax obligations of their workers”.

Gig economy workers

Gig economy legislation: What developments can we expect this year?

MPs urge ministers to speed up gig economy measures

It said this would not change the employment status of the worker, and would remove the requirement for such workers to complete a self-assessment tax return. It would make the collection of tax more efficient, it claimed.

Its research paper – Platforms, the Platform economy and Tax Simplification – stated that there were around five million self-employed workers across the UK – 1.3 million of whom work in the gig economy.

OTS tax director Paul Morton said: “The development of the gig economy and new ways of working through online platforms has profound consequences for the employment landscape.

“The idea of ‘PAYE for platforms’, which so far as we know has not been suggested before, would be optional. However, for those who chose it, it would remove the administrative burden from these individuals, who can be some of the most vulnerable in the labour market and mean that they should not get an unexpected tax demand at the end of the year.”

The tax simplification body also suggested HMRC should consider an app to help self-employed people manage their tax affairs and develop guidance for people who unknowingly create tax liabilities.

But tax consulting firm RSM said, if implemented, the changes could confuse self-employed workers further.

David Williams-Richardson, employer solutions partner at RSM, said a consistent approach would aid simplification, rather than operating different systems for different employment models.

“How would you distinguish between a self-employed platform worker and other self-employed individuals?” he asked. “Similarly, improved HMRC guidance and appropriate technology is required for all self-employed individuals rather than just those who operate via a platform.

“The real danger here is that solutions around employment status for tax become fragmented. We’ve recently seen this with the roll-out of off-payroll rules for the public sector that didn’t apply to the private sector, thus creating an uneven playing field.”

Samantha Hurley, operations director at recruiter association APSCo, expected the OTS’s recommendations would feed into a current HMRC consultation on off-payroll working in the private sector.

“While withholding tax was suggested as an option in a previous consultation, HMRC has ruled this out telling us that they feel that a system of withholding tax from everyone and then expecting those who were genuinely self-employed to claim back wrongly paid tax, would be inherently unfair,” she said.

“This new OTS recommendation is of course slightly different in that it suggests withholding tax from workers who are, in fact, determined as self-employed. Consequently, it is likely that the end client would need to undertake a status determination.”

Ashleigh Webber
Ashleigh Webber

Ashleigh is editor at OHW+ and HR and wellbeing editor at Personnel Today. Ashleigh's areas of interest include employee health and wellbeing, equality and inclusion and skills development. She has hosted many webinars for Personnel Today, on topics including employee retention, financial wellbeing and menopause support. Prior to joining Personnel Today in 2018, she covered the road transport sector for Commercial Motor and Motor Transport magazines, touching on some of the employment and wellbeing issues experienced by those in road haulage.

previous post
Women facing routine workplace bias; warning issued on rights after Brexit
next post
How to tailor benefits to a multi-generational workforce

Leave a Comment Cancel Reply

Save my name, email, and website in this browser for the next time I comment.

You may also like

Deliveroo signs deal with union GMB to cover...

12 May 2022

Queen’s Speech: absence of employment bill leaves organisations...

10 May 2022

Union urges Uber to make pensions Sharia compliant

20 Apr 2022

Employment Bill could face further delay

4 Apr 2022

Zero-hours work ‘tightens grip of structural racism’ on...

9 Mar 2022

Pimlico Plumbers holiday pay ruling: four steps for...

9 Mar 2022

Pimlico Plumbers loses holiday pay appeal in case...

1 Feb 2022

Status of Workers Bill heads to House of...

31 Jan 2022

False self-employment case adds to worker status conundrum

28 Jan 2022

Bill to create single worker status enters final...

27 Jan 2022
  • Strathclyde Business School expands its Degree Apprenticeship offer in England PROMOTED | The University of Strathclyde is expanding its programmes...Read more
  • The Search for Talent: Six Major Employer Pitfalls PROMOTED | The Great Resignation continues unabated...Read more
  • Navigating the widening “Skills Confidence Gap” in 2022, and beyond PROMOTED | Cornerstone OnDemand conducted a global study...Read more
  • Apprenticeships are the solution to your recruitment problems PROMOTED | Apprenticeships have the pulling power...Read more
  • What it really means to be mentally fit PROMOTED | What is mental fitness...Read more
  • How music can help to ease anxiety at work PROMOTED | A lot has happened since March 2020, hasn’t it?...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2022

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2022 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
    • Advertise
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Equality, diversity and inclusion
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Shared parental leave
    • Redundancy
    • Maternity & Paternity
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
    • OHW Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • XpertHR
    • Learn more
    • Products
    • Pricing
    • Free trial
    • Subscribe
    • XpertHR USA
  • Webinars
  • OHW+