Government to clamp down on bogus self employment

George Osborne has said the government will launch a new crackdown on bogus self employment as part of a new drive to tackle tax avoidance.

In the Autumn Statement today, the chancellor announced a package of measures to tackle tax avoidance, tax evasion, and fraud, which he said would raise over £9bn over the next five years.

The Treasury said measures would include a clamp down on tax avoidance and aggressive tax planning, including by “preventing employment intermediaries from disguising employment as self-employment to avoid tax”.

According to the Treasury, around 300,000 workers in construction are in this position, costing HMRC more than £380m.

The crackdown follows a pledge by Labour’s shadow chief secretary to the Treasury Rachel Reeves that a future Labour government would act immediately to tackle so-called “bogus self employment” on construction sites.

In September, Reeves said that if elected Labour would introduce rules to ensure that construction workers were automatically treated as employed directly by contractors if there were “obvious signs” that they were directly employed.