The Revenue Commissioners have urged businesses to consider the implications of a Supreme Court judgement which ruled delivery drivers for a pizza company should be treated as employees and not contractors.

The tax collector said any business which currently engages contractors, sub-contractors or other workers on a self-employment basis should review the nature of the arrangements in light of the ruling.

“Businesses are responsible for ensuring that the correct taxes are deducted from their employees’ pay (which includes both salary payments and any notional pay received) and remitted to Revenue under Schedule E (PAYE), at the right time,” Revenue said in a statement.

It added that it provides a range of opportunities for taxpayers to self-review, self-correct or make unprompted qualifying disclosures of any matters.

“Where a business considers that it may have previously misclassified a worker as self-employed, rather than as an employee, and wishes to regularise its position, it should do so as set out in Section 2 of Revenue’s Code of Practice for Revenue Compliance Interventions,” it added.

The case related to delivery drivers working in 2010/2011 contracts with Karshan (Midlands) Ltd, trading as Domino’s Pizza.

The drivers argued they were employees for tax purposes, but Karshan said they were independent contractors under “contracts for service”.

Karshan had appealed a 2018 decision of a Tax Appeals Commissioner that the drivers should be treated as PAYE workers.

The High Court rejected that appeal, but the Court of Appeal overturned the decision.

The Revenue Commissioners appealed that ruling to the Supreme Court and it overturned the Court of Appeal decision.

The Supreme Court found that the Tax Appeals Commissioner was entitled to conclude, that the drivers were employees of Karshan for the purposes of the relevant provisions of the Taxes Consolidation Act.