In a recent appeal to the First Tier Tribunal (“FTT”) by well-known TV presenter Adrian Chiles, it was ruled that the Intermediaries Legislation (known as IR35) did not apply. This was a significant success for the taxpayer – indeed, just over £1.7m of PAYE and NICs were at stake. This blog will consider the deciding factors in this case and the relevance of these for future cases. The decision of the case can be read here. What is the Intermediaries Legislation (IR35)? In summary, the Intermediaries Legislation (found in ITEPA 2003 and known as “IR35”) is applicable where an individual provides services through a Personal Service Company (“PSC”) and thereby avoids PAYE and National Insurance. It is necessary to con...

Dave Clark (“Clark”), former sports presenter for Sky Sports, had his IR35 appeal dismissed at the First-Tier Tribunal (“FTT”) resulting in a tax liability of over £281,000. The case turned on whether his working relationship with Sky fell within the IR35 intermediaries legislation, otherwise known as ‘off-payroll working’. The judgment can be found here. What is the IR35 intermediaries legislation? The Government introduced this legislation in 2000 to prevent tax avoidance from workers who offered their services through a limited company or a partnership in order to reduce or avoid PAYE and National Insurance Contributions (“NIC’s”). One of the main aims of determination is to ask: "if the intermediary did not ...

The IR35 anti avoidance provisions are contained in ITEPA 2003. The provisions impose employment taxes on those using a Personal Service Company (PSC) to enter into a contract for services (and thus pay corporation tax on profits) who in practice are engaged under a contract of service (and therefore should pay income tax and NICs on income). Recently, there has been a string of cases involving HMRC challenging well known TV presenters on the basis that they are caught by IR35. The most recent judgement of which was Eamonn Holmes v HMRC (2020). The Facts TV personality Eamonn Holmes set up a PSC in 2001 called Red, White and Green Ltd (RWG). From 2006 onward he has been presenting This Morning on ITV. During this time, RWG has been...

In March 2018 we published a blog on the case of Christa Ackroyd Media Ltd v HMRC at the first-tier tribunal (FTT). In short, the FTT found that former BBC ‘Look North’ presenter Christa Ackroyd was caught by the IR35 anti-avoidance rules and was therefore an employee rather than a freelance contractor through her personal service company, Christa Ackroyd Media Ltd (“CAM”). The FTT stated that where individuals are engaged through an intermediary (in this case CAM) under hypothetical contract terms that would represent employment by the end user if engaged directly, the intermediary must treat their monies received as income and operate PAYE. The FTT asserted that a test of overall control and mutuality of obligation were r...