HMRC wins IR35 case against BBC presenters
21 September 2019
HMRC has won an IR35 tribunal case at the High Court against three BBC presenters who will now have to pay back thousands of pounds in taxes through their personal service companies.
There have been a series of tribunal rulings involving television presenters which have seen varying outcomes. In this latest case, the tribunal found that that they had effectively been forced into contracting through personal service companies by the BBC, arguing that there was an “imbalance of bargaining power”. The judges said: “The BBC were in a unique position and used it to force the presenters into contracting through personal service companies and to accept reductions in pay.”
Despite this, in a decision which split the judges, David Eades, Tim Wilcox and Joanna Gosling were all deemed to be employees in all but name, which makes them liable to be taxed under IR35 rules. HMRC had pursued the trio for £920,000 in unpaid taxes.
The presenters argued that they were self-employed, but the court ruled that because they were told how, where and when to work, that the “assumed relationships were ones of employment”. However, the Treasury’s claim that the presenters acted in bad faith was dismissed.
In a joint statement, the three presenters said, “We have endured eight years of HMRC investigation and eventual determinations to reach this point on what is clearly a difficult and unclear subject even for judges. It has been a depressing and stressful period for each of us. However, we are grateful that the judgement, in its entirety, shows we have acted in good faith throughout.”
The BBC has acknowledged responsibility for the contracts and has said it will help to resolve the cases. Around £200,000 of the bill is employers’ National Insurance, which the BBC will have to settle.
From April 2020, changes will be introduced to the Intermediaries legislation, more commonly known as the IR35 rules, which will place the onus on medium and large-sized private sector bodies to check whether contractors fall within the IR35 legislation.
These rules have been in place for public sector organisations contracting workers supplied through their own personal service companies (PSCs) since 2017.
CIPP Payroll training courses
The CIPP offers a one-day training course on Employment Status and Modern Working Practices.
The CIPP's training course portfolio offers a wide range of courses across many topics and levels; ensuring that whatever your training needs - there will be something to suit you and/or your organisation.
In addition to our public course delivery, we can also provide you with a tailored in-house delivery of most training courses - click here to find out more.
Information provided in this news article may be subject to change. Please make note of the date of publication to ensure that you are viewing up to date information. Download the CIPP's Payroll: Need to know - your guide to payroll legislation and reporting for the most up to date data.