A number of operators within the gig economy have announced that they are changing the benefits that they offer to their contractors in light of a number of cases regarding employment status.
However, Midlands-based accountancy firm, Salhan Accountants, fears that drivers may get caught out when completing and returning their tax affairs if they fail to record these new benefits correctly.
Earlier this year, Hermes said that it would take steps to offer holiday and guaranteed earnings to its self-employed contractors in return for them confirming that they are not directly employed by the business.
The deal, struck with the help of the GMB union, came after a group of Hermes couriers won a legal battle in June 2018 to be classed as workers rather than self-employed.
The case of these drivers follows on from cases involving Deliveroo and Uber, in which workers have fought to have their employment status recognised.
The new arrangement at Hermes, described as ‘self-employment plus’, is an important step for gig workers and drivers, according to Dr Anjulika Salhan, a Director at Salhan Accountants, but she worries that some drivers may be caught out if they do not report their affairs accurately.
“A number of businesses in the so-called ‘gig economy’ are starting to extend new benefits to their contractors and self-employed workforce, however, these need to be recognised when reporting income to HM Revenue & Customs (HMRC),” she said.
“Many of those entering this new part of the economy may never have had to complete a tax return previously, so it is important that they seek additional advice if they are unsure of what they should and shouldn’t be reporting.”
Dr Anjulika said that in a lot of cases people assume that using the skills of an accountant would be prohibitively expensive, but she believes that with the advent of new technology it has never been easier.
She said: “For a very small amount – as little as £15 per week in a number of cases – self-employed workers and freelancers can buy into technology-driven services that will help them to record and report their affairs accurately to HMRC, so I would encourage gig workers to explore the options available to them.”
Salhan Accountants is already working with a number of professional drivers in the gig economy and is supporting them to report their income accurately with their cost-effective technology-led solutions.
To find out more about Salhan Accountants, please call 0121 455 7475 or visit salhanaccountants.co.uk
