The TV presenter Adrian Chiles has won a seven-year battle with HMRC, and saved £400K-500K in taxes.
HMRC claimed that he was not a freelancer when working for the BBC and ITV between 2012 and 2017, despite Mr Chiles having worked as a contractor through his own limited company since 1996.
HMRC argued he should have paid more tax as an employee of the broadcasters, where he worked on BBC programmes such as The One Show, Match of the Day 2 and The Apprentice: You're Fired, as well as on Daybreak and as a football commentator at ITV.
HMRC said Mr Chiles owed £1.2m in income taxes and almost £500,000 in National Insurance.
The case was part of a wider crackdown on “disguised employees” who reduce their tax bills by funnelling their income through personal service companies.
Such arrangements allow an individual to set up a company and pay themselves via a mixture of salary and dividends to save on tax, even if they do not hire any staff.
Employees pay income tax at 20pc of earnings up to £50,270 and 40pc above, plus NI at 12pc, while contractors typically pay corporation tax at 19pc and lower NI rates of 9pc, while dividends are taxed at rates starting from 7.5pc.
However, a tribunal ruled there was “no suggestion Mr Chiles set out to avoid paying tax” through his company Basic Broadcasting Limited.
Dave Chaplin of tax advice firm IR35 Shield is quoted by the Telegraph as saying that Mr Chiles had been the “victim of a very poorly run investigation by HMRC inspectors”.
He added:
“The tax office has put him through the wringer, both mentally and financially, due to the massive costs of having to defend himself, despite always paying his taxes correctly.”
Despite winning the case, Mr Chiles will still have to pay his own legal fees.
A spokesman for HMRC said the tax authority would “carefully analyse the outcome of the tribunal before considering next steps”.
Tax does have to be taxing.
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Why do HMRC take on, and lose, cases like this when they are prepared to turn a blind eye to £billions in Covid related fraud?
ReplyDeleteBecause the government has told them to turn a blind eye.
DeleteSimple, really.
But the government doesn't tell HMRC which individuals to pursue.
DeleteThe government didn't tell HMRC not to bother checking covid claims before taxpayers' money was handed out.
The government didn't tell HMRC to do nothing about the covid fraudsters.
These were independent, operational decisions taken by HMRC not politicians.
HMRC is both a vindictive and completely incompetent outfit.
Vile, really.
You seriously think that the government didn't give the nod to pay covid claims before in-depth checks?
DeleteYou seriously think the government didn't give the nod to pass on following up covid fraud.
You seriously think the effective writing-off of billions of pounds of revenue is done without the nod of the government?
You seriously think that's a pig flying past your window?
You've seriously got a lot to learn about the way government operates in this country.
HMRC were told to pay first, ask questions later when it came to Furlough payments. If they had of asked questions before payment, fraud would have been much less, BUT taxpayers in real need would have suffered immense hardship. Is that what you would have preferred-people unable to feed their kids?
DeleteIts a fact of life that some people will try to defraud any system.
But don't let the facts of how Furlough was operated put you off of your blind hatred of HMRC and their employees.