IR35 legislation in the broadcasting industry

10 October 2016

10 October 2016

More than 100 BBC presenters are under investigation after being suspected of wrongly using personal service companies to minimise their tax bills.

The Daily Telegraph has reported that a very significant number of BBC news presenters, as well as a number of staff at other broadcasters, face demands to hand over unpaid tax and national insurance contributions after HMRC launched a probe into whether they had incorrectly declared themselves to be self-employed.

The BBC announced in July that it had moved 85 presenters onto its books as full-time employees, after a report published in 2012 found that the corporation paid more than 124 stars in excess of £150,000 a year via personal service companies.

Stars such as Jeremy Paxman and Fiona Bruce have previously been paid via their own service companies, although there is no suggestion that they are suspected of any wrongdoing.

The new revelations are included within a tax tribunal judgment involving BBC newsreaders Tim Willcox and Joanna Gosling.

The pair are appealing against a ruling by HMRC that they failed to pay enough tax during years in which they claimed, they were not employed by the corporation and were instead paid via their personal service companies.

A hearing at the First Tier Tax Tribunal in July heard that HMRC began investigating 23 BBC presenters in May last year, to establish whether they had fallen foul of IR35 rules, used to determine whether workers should be taxed as employees, or are self-employed.

“The BBC also understands that HMRC has initiated or indicated their intention to initiate IR35 proceedings in relation to presenters who are engaged by other broadcasting organisations.

The appeals are therefore extremely important not only to the individuals in question but also to the BBC and to the broadcasting industry as a whole.  The appeals are likely to be the first cases to test the freelance model in the broadcasting industry against the IR35 legislation."

Read more from The Daily Telegraph.