IR35 continues to confound just about everyone who gets near it.

In the latest first tier tribunal ruling (178 pages long and eight years in the making), HMRC has ‘won’ its battle with ‘BBC’ journalists Joanna Gosling, David Eades and Tim Willcox.

It means the presenters essentially face a big tax bill. An earlier High Court hearing said the BBC had forced them into the wrong contracts.

The presenters said “they had not heard of IR35 until it was mentioned to them by their accountants or when HMRC inquired into their tax affairs”.

 

Tax authority

HMRC lost an IR35 case against Loose Women broadcaster Kaye Adams. TV’s Lorraine Kelly also beat the tax authority over a £1.2m bill.

But this latest case, which ended with a split decision, is bound to worry about 100 other BBC journalists who are involved in IR35 cases.

IR35 legislation is designed to crack down on tax avoidance by “disguised employees” who set themselves up as separate companies and pay corporate rather than personal tax.

Thus theyavoid being treated as employees. And this is where it’s been getting tricky (putting it mildly).

The Association of Independent Professionals and the Self-Employed (IPSE) says the judgment shows how confusing and complex the tax regulation is.

Andy Chamberlain, IPSE deputy director, says “That this case has taken eight years and ended up with an uncertain split decision shows how confusing and unfit for purpose IR35 is.

“We remain at a loss how the Treasury expects medium sized businesses to accurately apply IR35 to their contractors from next year when HMRC and tax judges struggle.

“Burdening business with the complexity of IR35 only damages the UK economy and the overall tax take.

 

New professional standards committee

Meanwhile, former ICAEW president Paul Aplin has written an interesting update about the Treasury’s creation of a new professional standards committee.

It will take information from independent experts and advise on issues relating to HMRC powers.

Paul says it’s similar to the former Powers Implementation Oversight Forum. He adds that the new body should allow constructive professional dialogue, which, he says, is in everyone’s interests.