'Gig economy' workers alerted to tax deadline
S elf-employed people who started trading in the 2016/17 tax year have just weeks left to register for self-assessment with HMRC to meet the October 5th deadline.
Issuing this reminder, the Low Incomes Tax Reform Group said the deadline also applies to people working in the ‘gig economy,’ but said it fears such freelancers may not realise it.
By law, all new freelancers must declare a new source of
income, like receipts from a self-employed trade, by October 5th in the tax
year following that in which the new source began.
This law applies to people in the ‘ gig economy’ too, such as individuals who do a lot of different jobs, often through an online platform such as Uber or TaskRabbit.
“LITRG is concerned that because of the irregular and often ‘on demand’ nature of ‘gig economy’ income it may not even occur to people that their activity is taxable,” the group said.
“They may also be unaware that where the level of income means that there will be no tax or National Insurance due, HMRC should still be notified as it may still be necessary to complete a tax return.”
The Revenue additionally wants to hear from people who not only work casually or informally, but who also have recently done so just once, as income from a one-off job is taxable too.
"Behind the innovative technology and new language surrounding the ‘gig economy’ lies an old-fashioned taxable source of income," said LITRG Chair Anne Fairpo.
"If a person’s activity is
regular, organised and is done with a view to generating a profit, then this
will put them within the realms of self-employment and the UK's complex
self-assessment tax return system."
The group warned that a failure to notify a new source of income to HMRC, and a failure to complete and submit a tax return when required to do so, can lead to financial penalties.
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13th September 2017