Following its defeat over a Sky rugby commentator’s employment status, HMRC is appealing the ruling at the Upper Tribunal
The First Tier Tribunal (FTT) ruled in favour of Stuart Barnes in January this year, after he appealed a tax demand from HMRC for unpaid tax of £695,461.97 related to earnings between 2013 to 2019 for TV commentating work for Sky Sports.
Barnes provided services through his personal services company, S&L Barnes Ltd, and had numerous income streams, including work for the Times and Sunday Times, as well as the Sky contract.
HMRC believed the arrangements fell within the intermediaries provisions of the Income Tax (Earnings and Pensions) Act 2003, more commonly known as IR35, which is designed to clamp down on contractors who charge for their services through personal service companies.
It was the fourth Sky TV case brought before the FTT, where individuals were engaged on almost identical contractual conditions.
In light of Barnes’ other work, he was found to be in business on his own account when entering into the contracts with Sky TV. He was given a high level of control over his commentating work and was the main pundit for ruby union coverage on Sky.
The Judge also ruled that there were additional tacit agreements outside the contract, which formed part of the ‘circumstances’ when constructing the hypothetical contract, and so IR35 did not apply.