HMRC has recently challenged the employment status of several journalists and commentators who work for the BBC and other broadcasters. It won in the case of Christa Ackroyd, but Lorraine Chase and Kaye Adams successfully defended their right to be taxed as independent contractors (see our newsletter 18 April 2019).
Paul Hawksbee is the latest presenter to be subject to an IR35 challenge in respect of his work for Talksport Radio, where he has co-presented a live daily show for the last 18 years. However, this was put in context of Hawksbee’s professional writing career which extend over 34 years.
In the three tax years under review in this case the fees from Talksport represented around 90% of the income of Kickabout Productions. He was contracted to present at least 222 shows per year, at £575 per programme plus expenses, but he was only paid for the shows he presented.
At the heart of case was whether the radio station exercised control over Hawksbee’s work. HMRC argued that it was enough for the right of control to exist and that it was not necessary for control to be exercised in the relationship, but Judge Scott disagreed. He noted that this area of evidence was apparently well rehearsed by both Hawksbee and the Talksport programme director.
The FTT concluded Talksport had control over where and when the work was performed but the radio station did not control how Hawksbee performed his services or what was included in the programmes. There was no right of substitution mentioned in the written contracts.
Hawksbee was not part and parcel of the Talksport team; he did not attend staff events, had no line manager, received no benefits, sick pay or holiday pay and was not obliged to undertake training or appraisals.
The FTT concluded that the relationship between Hawksbee and Talksport was not one of employee and employer so IR35 did not apply. However, this was a marginal decision as the second member of the tribunal did not fully agree with Judge Scott’s conclusions.
If any clients are freelance contractor in any sector, it is worthwhile reading the full judgment in this case, including the dissenting view in the appendix.
Written by the Tax Advice Network