The reforms are part of the government's crackdown on so-called disguised employment, where workers behave as employees but avoid paying regular income tax and national income contributions by billing for their services through personal service companies (PSCs), which are taxed at lower corporate rates.
But this isn't true though, is it?
They do pay income tax like every one else. There is no such thing as being taxed on "lower corporate rates".
There was a tax advantage for working this way, but it was closed in 2017 where Dividend Tax has been adjusted so that when business paid worker low salary + dividend, it very much was equal to PAYE.
People used low salary + dividend, not because of tax implications, but because it suited freelancing better. PAYE is not designed for freelancing (it creates tax code mess and eventually you pay more tax than you should, because HMRC can't calculate it properly and then you have to go through hassle of getting tax refunds).
Biting the hand that feeds IT
