Question to the HM Treasury:

To ask Her Majesty's Government what assessment they have made of the impact the revised tax legislation which takes effect next month will have on the ability of HGV drivers to remain self-employed.

The changes to the off-payroll working rules come into effect on 6 April 2021 and were legislated for in Finance Act 2020. The off-payroll working rules have been in place for over 20 years and are designed to ensure that individuals working like employees but through their own limited company pay broadly the same Income Tax and National Insurance contributions (NICs) as those who are directly employed.

The Tax Information and Impact Note (TIIN)^[1] published at Spring Budget 2021 sets out HMRC’s assessment that the reform of the off-payroll working rules is expected to affect about 180,000 individuals working through their own limited companies.

The changes to the off-payroll working rules do not introduce a new tax liability and do not apply to the self-employed. HMRC's published guidance^[2] includes an explanation of when lorry (HGV) drivers are likely to be employed and self-employed. This guidance applies to those working through Personal Service Companies and so in scope of the off-payroll rules, and is not changed by the reform.

[1] https://www.gov.uk/government/publications/off-payroll-working-rules-from-april-2021/off-payroll-working-rules-from-april-2021

[2] https://www.gov.uk/hmrc-internal-manuals/employment-status-manual/esm4210