An appeal by TV favourite Eamonn Holmes, in an attempt to overturn the 2020 decision of the First-tier tax tribunal (FTT) which found in favour of HMRC regarding his IR35 case, has been dismissed by the Upper-tier tax tribunal (UTT).
The case concerned engagements between his limited company, ‘Red, White and Green Limited’ (“RWG”) and ITV during the tax years between 2011/12 and 2014/15.
RWG appealed the original decision on the grounds that the FTT erred in law in relation to control by failing to distinguish “editorial control”, which is how a worker does the work, from other more important forms of control, in particular what work should be done by the worker.
It was further held by RWG that the FTT had also erred in law in its overall analysis because it wrongly considered that its finding of sufficient mutuality of obligation and sufficient framework of control led to a presumption that there was a contract of employment and it wrongly disregarded certain factors in its overall consideration at this stage and failed to consider the whole picture.
On the question of control, RWG argued that ITV did not exercise sufficient control over Mr Holmes and that the FTT had focussed too much on those instances of editorial control whilst ignoring examples of where ITV did not and could not exercise any control. Unfortunately, the UTT was unable to agree, suggesting that the FTT had not made any lawful error in their approach when considering control.
RWG argued that the FTT had not correctly considered the reference to the passages from the decision of Briggs J in Weightwatchers, which were expressly overruled by the Court of Appeal in Atholl House. The tribunal agreed, stating: “There is no suggestion that it omitted any relevant authorities or that its analysis indicates any other error of law, apart from its reference to Weightwatchers,” but then went on to state: “…we are satisfied that the FTT’s error in referring to the approach in Weightwatchers was not a material error. We reach that conclusion because, on a fair analysis, the FTT clearly weighed in the balance all the factors which it considered to be relevant, applying Hall v Lorimer.”
The final nail in the coffin was the UTT response to the claim by RWG that the FTT had given no weight to the other activities of Mr Holmes away from ITV that would have clearly demonstrated that Mr Holmes was truly in business on his own account. The UTT stated “we do not accept that the FTT failed to consider whether the ITV contract was part of a wider business activity”.
In the end no grounds of appeal succeeded, and the case was dismissed in full.
It should be noted that at the UTT no new evidence can usually be introduced. To be successful in an appeal, it needs to be shown that the FTT has erred in law in its decision making.
The takeaway from this case appears to be that it is concerning to see how different outcomes are being reached by FTT when considering what appear to be very similar contractual and other in-business arrangements of TV personalities and presenters. This inconsistency continues to muddy the waters of employment status and is very unhelpful for contractors and engagers alike who are trying to comply with the legislation.
Clear contractual terms appear to be key in supporting any outside-of-IR35 opinion.
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