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In HMRC v Atholl House Productions Limited [2021] UKUT 0037, the Upper Tribunal (UT) upheld the First Tier Tribunal's (FTT) decision that the TV and radio presenter, Kaye Adams, was an independent contractor and not caught by IR35.

 Ms Adams hosted a radio show for the BBC where her services were provided through an intermediary that contracted with the BBC. HMRC believed that the arrangement was caught by IR35 and that if the presenter had provided her services directly to the BBC, she would have been classed as an employee. Ms Adams appealed against the decision of HMRC and the FTT found in her favour. 

It is accepted that when applying the provisions of IR35 (as found in s.49 ITEPA 2003), there are three steps to consider:

  1. What are the terms of the actual contract between the intermediary and the End-Client? The FTT looked to the decision in Autoclenz v Belcher [2011] UKSC 41 (Autoclenz) for how to interpret the contract.
  2. What would be the terms of the hypothetical contract if the individual were to contract with the End-Client directly?
  3. Would the hypothetical contract be one of employment? In ascertaining this, the three tests as set out in Ready Mixed Concrete (South East) Limited v Minister of Pensions and National Insurance [1968] 2 QB 497 (Ready Mixed Concrete) as per McKenna J, were used.

The FTT found that:

HMRC appealed the FTT's decision on the basis that it had erred in law and in consideration of irrelevant facts when applying the Autoclenz and the three tests of Ready Mixed Concrete.

The UT held that:

The UT constructed what it believed the hypothetical contract would look like and it was to this that the three Ready Mixed Contract tests were applied. HMRC's remaining arguments around the FTT's flawed reasoning were no longer valid as the UT had replaced these with their own.

The UT applied the three tests as follows:

The UT dismissed HMRC's appeal. 

Useful guides on this topic

IR35: Loose Women presenter not an employee
This is the FTT case summary.

IR35: Off-Payroll Working 
What is IR35? How does it work? How is the deemed payment calculated? What expenses are deductible?

Employment Status & detailed checklist 
An employer (including an Employment Agency) must assess any worker's employment status so that they can fulfil their obligations under employment and tax law.

External link

HMRC v Atholl House Productions Limited [2021] UKUT 0037


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