Anyone with half an eye on IR35 news at the moment will see multiple stories filtering through.
These relate to HMRC’s big wins in IR35, challenging those it feels have incorrect assessment under IR35.
Case #1: Talksport presenter, Paul Hawksbee
The most recent of these is the £140,000 tax case against Talksport presenter Paul Hawksbee. Hawksbee appealed a 2020 Upper Tribunal decision but was unsuccessful.
This ruled that work he completed at Talksport from 2012-2015 did fall under IR35 and therefore tax and national insurance had been charged incorrectly. In fact, the deficit was £89,758 of income tax and £53,368 of national insurance.
When this case went to the original First Tier Tribunal, they found in favour of Hawksbee. However, the HMRC appeal was upheld by the Upper Tribunal.
Case #2: McCann Media Ltd
The second case also revolves around the status of IR35. This time with McCann Media Ltd, for Neil McCann. Two of his contracts covering periods from 2014-2017 while working at Sky came under HMRC scrutiny. HMRC deemed these to be wrongly determined under IR35 and the amount in the appeal was £210,000.
It was decided that his contract was actually one of employment, and the appeal by McCann was unsuccessful. Dave Clark, also from Sky Sports lost his case against HMRC for work from 2013-2018. In this case, reports suggest that very little evidence was offered in support of the originally claimed IR35 status.
More IR35 Cases in Scope for HMRC
These are all high-profile cases for HMRC that went their way, but none of the claimants are at all pleased with the way the rulings have gone. Mind you, this is hardly surprising.
Yet there is further unrest coming in the direction of HMRC at the moment. This time it is from Eammon Holmes who has been fighting a case since 2018 relating to his earnings from ITV. He hit out on live television calling HMRC “the department of thievery”.
The segment was to be about non-dom tax status, but became rather more personal. His tax bill for this issue is £250,000. He described a lack of consistency in the tax rules and people being hounded for money they do not have.
The situation may have led to unrest, but this is inevitable from those who are being pursued. HMRC have said there is no plan to target specific sectors, but even if this is the case now, it may not be in the future. They have said there are over 200 media-related cases they have taken forward and they have already successfully challenged half.
As the first year of IR35’s extension to medium and large businesses is over and the soft-landing is finished, can we expect to see an increase in cases like this? Well quite probably. We will just have to see who decides to vent their frustration next, as no doubt there will be more.
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