Freelancers delighted by major tax case win over the Inland Revenue


Freelancers delighted by major tax case win over the Inland Revenue

Lost Case

The Inland Revenue were hoist by their own petard when one of their own employees successfully brought a case against them and won it.

The Inland Revenue were trying to claim that freelancers who work from home were liable to pay Business rates as well as the local Council Tax. This would have hit contractors very badly, and would have been on top of all the other woes foisted on them by the Inland Revenue and the Government.

This case is thought to affect millions of people. The Inland Revenue had calculated that over 2 million people work from home and might be liable for this tax.

No Appeal

Eileen Tully, who works for the Inland Revenue successfully challenged this interpretation of policy by her employers.

The Inland Revenue said that it would not appeal against the verdict, so the threat is now over totally.

They will not try and get business rates off of freelancers in the future, unless they are running full scale businesses or employing people from their homes.

Eileen Tully suffered from a disability and had to work from home. She was in danger of having her premises classified as her primary place of business and have to pay Business tax.

She had an office set up at home with a computer, a desk and a printer.

Union Backing

She was given the backing of her union to fight the case. This is something that most IT workers miss out on.

The Land‘s Tribunal said that there must be lots of homes across the country where people living there do part, or all, of their work at home but there are no outward indications that someone worked on the property.

He said that the home should only be re-rated if it lost its domestic character and if employees visited the premises.

That looks fairly conclusive then. Freelancers would have to change the character of their property to a place of business for it to be rated for business rates. As there is no need to do this, and as the primary purpose of their property is as a home, they look to be home and dry and safe from this particular imposition form the Inland Revenue.

Strike another one up for freelancers!

Articles are sponsored this week by TreasureGuard who manage Limited Companies ensuring a maximum retention of your income; legally protected outside IR35. Please contact for a free review of your IR35 status at [email protected] or phone Matthew Balmforth at 0117-908-0133

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