fbpx

Rugby Union Commentator Relieved of £700,000 Tax Demands in IR35 Appeal

3rd April 2023 By

Many media personalities who provide their services via their own private companies have, in tax terms, expensively fallen foul of the so-called IR35 legislation. However, in one case, a Rugby Union commentator’s company succeeded in overturning six-figure HM Revenue and Customs (HMRC) demands.

The man engaged in lucrative work as a media pundit after enjoying a stellar career on the field of play. Via his company, his services were provided to a broadcaster. Citing IR35, HMRC took the view was that he was to all intents and purposes the broadcaster’s employee. On that basis, the company was assessed for almost £700,000 in Income Tax and National Insurance contributions.

Ruling on the company’s challenge to those demands, the First-tier Tribunal (FTT) found that there was a mutuality of obligation between the man and the broadcaster. He was obliged to perform his services personally and the broadcaster was required to pay him a fixed annual fee. The broadcaster also had a sufficient level of control over how he went about his work to found an employment relationship.

Upholding the appeal, however, the FTT drew a distinction between the man’s role as a commentator – providing analytical insights and ‘second voice’ punditry during matches – and that of a programme presenter. The broadcaster did not stipulate a minimum number of days on which he had to work, only a maximum, and his annual fee did not resemble a salary. It was more in the nature of a block fee paid for the exclusive right to have first call on his services for a specified period.

There was no embargo on him reproducing in other media outlets opinions he had previously expressed during one of the broadcaster’s live shows. He took a personal reputational risk every time he appeared on air and he bore editorial responsibility for every word falling from his lips.

His work schedule was apparently set by a process of gentlemanly consensus. The broadcaster was reasonable in its demands on his time and, in the event of clashes, granted him reasonable leeway to refuse engagements. Although the company derived about 60 per cent of its turnover from the broadcaster during the relevant period, the FTT noted that the man also wrote popular newspaper columns and provided his services to other broadcasters. Overall, the FTT did not view his relationship with the broadcaster as one of employment.

Source: Concious

Latest News

Tenants Can Purchase Freehold When Landlord Cannot Be Found

11th June, 2024 By

The Leasehold Reform, Housing and Urban Development Act 1993 gives qualifying leaseholders the right to join together to buy the freehold of their properties – a process known as collective enfranchisement. A recent case demonstrated that this right can be exercised even when the landlord cannot be found. The leaseholders of two flats in a terraced house wished to purchase it from the landlord, but were unable to ascertain his whereabouts and therefore could not serve notice on him under Section 13 of the Act. They therefore applied for an...

Court Refuses to Set Aside Divorce Order Applied for by Mistake

6th June, 2024 By

While the courts have a range of powers to set aside orders, they will only exercise them in limited circumstances. In a somewhat surprising case that has attracted much comment, the High Court declined to set aside a final order of divorce that had been applied for by mistake. A couple separated in January 2023, after more than 21 years of marriage. In October that year, while financial remedy proceedings were still ongoing, the wife's legal representatives inadvertently applied for a final order of divorce in respect of her instead...

Waiting Time for Grants of Probate Falls

3rd June, 2024 By

Following concerns last year about delays in processing probate applications, recent figures from HM Courts and Tribunals Service show that waiting times for grants of probate are continuing to improve. The average time from submission of a probate application to probate being granted fell to 11.3 weeks in March 2024, a decrease from 13.7 weeks in February and 13.8 weeks in January. This is the lowest figure since March 2023, when the average was 10.8 weeks. The longest waiting time since then was in November, at 15.8 weeks: that month,...

Late Appeal Against Tax Penalties Rejected

31st May, 2024 By

It is incumbent on taxpayers to make sure they fully comply with their obligations to file returns and pay any tax due. The point was illustrated by a recent case in which a taxpayer whose return had not been received by HM Revenue and Customs (HMRC) failed to persuade the First-tier Tribunal (FTT) that he should be permitted to appeal against the resulting penalties. On the evening of 31 January 2014, the man had completed his 2012/13 Income Tax return on HMRC's website. Shortly afterwards he went to Cyprus, and...