Fraud crackdown is in it for the long haul

Haulage drivers are increasingly being paid as if they are self-employed rather than through PAYE, the Road Haulage Association (RHA) warns.

It says while ducking the PAYE route is applicable if drivers own the truck, it is unlawful if the truck belongs to another party. Dodging the correct tax code, the RHA adds, means that the employer evades income tax and National Insurance, along with drivers’ rights under employment law.

Expressing concern that the practice gives an unfair advantage over firms working within the law, the RHA says tax status fraud has become a serious concern for the industry.

“With a growing driver shortage in the UK, this means that law-abiding hauliers are losing drivers and losing work to firms and drivers who break the law,” said RHA chief executive Richard Burnett.

“The practice is also damaging to law-abiding driver agencies, who are losing drivers to less reputable competitors.

“Incorrect tax status is not a new issue but it has become a much more serious concern this year.”

He added: “Our concerns are for the health of the UK haulage sector. It is coming under increasing pressure to break the rules and hauliers who may inadvertently be paying drivers off-payroll may face a heavy claim for back tax and penalties of up to 70 per cent of the tax and NI arising. Also, individual drivers could face bankruptcy if they evade tax payments and then HMRC enforces its rules.”

The RHA suspects that among the reasons for an increase in fraud is the fact that some firms simply want to cut corners. But it also suggests that others are being poorly advised.

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