HMRC launched a new one-to-many campaign on 15 January 2025 specifically targeting delivery drivers who HMRC believe have failed to deliver a tax return disclosing their income. If you have received a nudge letter from HMRC, do not ignore the letter. Read on to find out how to address your past and present UK tax obligations.
Why have I received a nudge letter from HMRC?
HMRC receive information from a wide range of sources, and in this case they have received information from courier companies such as DPD, Yodel and Evri regarding fees paid to delivery drivers. HMRC may have written to you because they have reason to believe you have earned more than £1,000 income in the 2023/24 tax year (6 April 2023 to 5 April 2024) from making deliveries.
If you have not received a letter from HMRC, but you have earned more than £1,000 in income, then you may still need to act now.
What should I do if I earned more than £1,000 income?
If you have never done so before, you need to register with HMRC as self-employed. This usually needs to be done by 5 October following the end of the tax year in which you first started being self-employed and is a one-off job. Even though the deadline has passed for 2023/24 to register for self assessment, if you have never done so before you still have to do this as soon as possible in order to obtain your Unique Tax Reference (UTR).
Once registered, you can then prepare and file a tax return. This should normally be done by 31 January 2025 for the 2023/24 tax year, however if you are new to self assessment HMRC will write to you with a ‘notice to file’ which will contain an updated deadline to submit a return following your initial registration.
Any income tax and National Insurance contributions due should be paid by 31 January 2025, and interest will accrue daily on any late payments. You can make a payment before you have submitted a tax return.
You will need to continue filing tax returns and paying any taxes due by 31 January each year for as long as you continue to earn self-employment income.
What if I have earned income from making deliveries in previous years?
If you have been earning more than £1,000 in income from making deliveries prior to 6 April 2023, then the time has passed to file a tax return, but don’t panic. If you were unaware of your historic obligations, we might recommend HMRC’s Digital Disclosure Service to make a voluntary disclosure. This facility exists specifically to help regularise your historic tax affairs.
In more serious cases, for example if you have deliberately not declared all sources of income to HMRC, it may be necessary to consider making a disclosure to HMRC under the Contractual Disclosure Facility / Code of Practice 9 (COP), which can protect a taxpayer from the risk of criminal prosecution.
New reporting rules for digital platforms
If you make deliveries for companies such as Deliveroo, Just Eat, or Uber and Uber Eats, there are new reporting rules for those digital platforms which requires them to provide information to HMRC. From January 2025, digital platforms will have to report your information to HMRC if you either make more than 30 sales or receive more than 2,000 euros (approximately £1,700) for those sales in a calendar year.
If you have not been filing tax returns or declaring all your income historically, you can expect to fall onto HMRC’s radar in the coming months. If you don’t do anything now, you will more than likely receive a nudge letter later in 2025, following the first deadline for digital platforms to report their data by 31 January 2025.
How can Menzies help with a tax disclosure?
At Menzies we have a team of tax disclosure experts who have helped thousands of clients through the disclosure process, whether that’s a voluntary disclosure or a more serious case under COP9. Engaging with a specialist disclosures adviser is recommended to ensure you are not reporting more than you need to to HMRC, and that any financial penalties are mitigated. We can also respond to HMRC’s letter on your behalf, and our team of private client specialists can help you with your current and future tax returns.
If you would like to discuss a nudge letter you have received from HMRC, or would like support with filing a tax return or tax disclosure, please contact Menzies’ Tax Disputes and Disclosures team.