HMRC to check gig workers are paying correct tax

From January HMRC will be using information on earnings directly from gig platforms to ensure gig workers are paying the right tax.

Self Assessment Tax Return


HMRC is reported to be preparing to launch a tax crackdown on side hustles and the wider gig economy.

The new rules, effective from January 1st, will require platforms like Uber, Etsy, and Airbnb to record users’ income and report it directly to HMRC rather than HMRC trusting freelancers and gig workers.

It will cover digital platforms in the UK that facilitate the provision of services or the sale of goods by UK or other taxpayers as well as UK taxpayers who provide services or sell goods on digital platforms. The reporting rules list apps and websites which facilitate the provision of goods and services, such as the provision of taxi and private hire services, food delivery services, freelance work and the letting of short-term accommodation.

The  Government says: “The regulations will support the government’s work to help taxpayers get their tax right first time, and to bear down on tax evasion.”

An HMRC spokesperson said:“The vast majority of people pay the correct amount of tax. We use various methods, including working with online rental and marketplace platforms, to help make it as easy as possible for people to pay the right tax.”

HMRC says some people earning money through online platforms will need to complete a Self Assessment tax return. Information on who needs to complete a return can be found here.  If someone’s gross income before expenses is no more than £1,000, there is no requirement to complete a Self Assessment, but there may be circumstances in which the individual chooses to do so.

HMRC adds that any profits earned from multiple sources of income are taxed progressively in line with income tax rate thresholds i.e. the taxable profits would be added to PAYE income to establish the rate of tax and national insurance contributions due.

Meanwhile, the Competition and Markets Authority (CMA) has launched an investigation into several television production companies, including the BBC and ITV, saying it believes the companies may have broken competition law in the use of external services and non-permanent staff to produce, create and broadcast their content. The CMA said it “has not reached a view as to whether there is sufficient evidence of an infringement” for it to issue a statement of objections to any party or parties. In July, the regulator announced an investigation into suspected breaches of competition law in relation to the purchase of services from freelancers in sports content by the BBC, BT Group, ITV, Sky UK, and others.

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