BBC Presenters IR35 Revolt
There is a BBC presenters IR35 revolt over the way the BBC is implementing the Government’s IR35 changes in the public sector.
It used to always be that people decided themselves whether they were inside IR35 or outside. They made their tax status choices that way.
If they felt that they were outside IR35 they worked through Limited Companies.
If they were inside IR35 they tended to operate through contractor umbrella companies.
Very few actually paid the IR35 tax.
However, since April, because of new Government rules in the public sector, it is the Government department who will decide their employment status rather than the contractors.
BBC Presenters IR35 Revolt
Now, personal finance expert, Paul Lewis, and broadcaster priest, the Reverend Richard Coles, are leading a revolt over the way the BBC has implemented the Government’s IR35 tax changes.
They are part of a group of 170 BBC Presenters taking on the BBC over the way they are imposing rules over the use of limited companies.
Many of them are being pursued by HMRC for, in some cases, over £100,000.
Always Employees Rather than Freelancers
HMRC claim that they were always employees and should pay the back tax.
The Government changed how a freelancer was classified in employment terms.
It is now down to the employer to say whether a contractors i inside or outside IR35. The contractor used to decide that himself or herself.
So, when the BBC reclassified many of those who operate through limited companies as now employees, HMRC stepped in and said this meant that they were always employees and so needed to pay a whole load of back tax.
Nightmare Scenario for Contractors
This is the nightmare scenario for contractors who are currently operating through limited companies.
As the BBC has not come up with a way to classify its presenter as employees or in self employment, they had had to pay a lump sum to HMRC.
They now want to recoup that from its freelance (or not) employees.
HMRC are claiming that 100 BBC presenters wrongly classified themselves as freelancers when they were really employees.
HMRC Want Back Taxes from Freelancers
They now want them to pay back all those back taxes going back many years.
One presenter, Christa Ackroyd, from Look North, lost a case at the tax tribunal last month and must now stump up £400,00 in back tax.
Many of the presenters said that the BBC forced them to go down the limited company route so that the BBC could save on employers national insurance.
Operating Through Personal Service Company
The priest / presenter, Richard Coles, has been operating through a personal service company for years.
However, he is now classified by the BBC as an employee.
This is despite the fact that he works for several different organisations as a freelancer.
He’s in the ridiculous tax situation of working on a freelance basis for several companies – while being an employee of the BBC.
So, he is helping organise this BBC Presenters IR35 Revolt.
Public Sector Freelancers Dreaded
This is the scenario that public sector freelancers dreaded most.
Not only are Government departments reclassifying them as employees but HMRC are now going to hunt them down to pay the back tax as they now regard them as having been really employees – even when they believed themselves to be freelancing.
That could cost them a lot of money.
And the Government plan to roll this out to the private sector too next April.
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