2020 has presented us all with a lot of challenges. At least we didn’t have to think about changes to IR35 legislation as well. We’ve still got that to look forward to…
Postponed from April 2020, the changes are due to come into force in April 2021 and could affect your salary and the amount of tax and National Insurance (NI) you pay.
As an HGV driver, you might not need to know the finer legislative details, but you do need to understand the basics.
If you’re classified as being ‘inside IR35’, you’re considered an employee; if you’re ‘outside IR35’ you’re deemed to be self-employed. Which category you come under depends on a number of factors including where, when and how you carry out your work.
From April 2021, the majority of truck driving jobs are likely to be classed as ‘inside IR35’, so their earnings will be subject to tax and NI. That’s because trucking companies generally give drivers specific tasks to carry out, plan their schedules, provide them with a vehicle to drive, and pay any insurance and fuel costs.
It’s that lack of autonomy during the working day that means HGV drivers are seen as employees of the company rather than self-employed. Exceptions to the rule would be if someone is an owner-driver.
For a number of years, HMRC has been taking a growing interest in the relationship between transport companies and their self-employed drivers. The new IR35 tax change will force all businesses to review payroll worker arrangements and it will only be a very limited number of truck drivers who will be classed as truly self-employed come April 2021.
Make sure you are clear on how the changes will impact you and your wages.