HMRC IR35 Defeat to Helen Fospero
The latest HMRC IR35 defeat comes at the hands of Helen Fospero, a TV presenter. Helen works closely with Lorraine Kelly, who recently won her own IR35 tribunal case. So, why HMRC continued with chasing Helen Fospero is not clear. They, and the Government, received yet another lower tier tribunal defeat.
Contractor Questions on HMRC IR35 Defeat to Helen Fospero
- Who is Helen Fospero and why is she fighting an IR35 case?
- Was there Mutuality of Obligation (MOO)?
- Was there Supervision, Direction and Control of Helen Fospero?
- What Other Indicators of Self Employment did Helen Prospero have?
- Was there a Right of Substitution?
- Why did the judge inflict another HMRC IR35 defeat?
Who is Helen Fospero and why is she fighting an IR35 case
The BBC told Helen Fospero that she had to set up a personal service company and operate through that. They did not want to take her on as an employee. That would entail extra expenses for the BBC. So she set up Canal Street Productions.
HMRC believed her contracts form 2012-2014 were inside IR35. She was a presenter on the shows Daybreak and Lorraine on ITV Breakfast.
The IT Contractors were worth 74% of her income in those years.
Judge Greenbank took into consideration three main areas:-
- Mutuality of Obligation
- Supervision, Direction and Control
- Indicators of Self Employment or lack of them.
Was there Mutuality of Obligation (MOO)
According to the Judge there was no Mutuality of Obligation. Firstly, ITV did not have to provide further work for Helen Fospero of Canal Street Productions outside of those engagements. ITV would have had a legal duty to provide permanent employees with work under their Contractor of Service. There was not enough evidence for a contract of employment.
Was there Supervision, Direction and Control of Helen Fospero
The judge said that what was important here was contractual control.
ITV had editorial control over the content of the programmes. However, Helen Fospero made her own decisions on her preparations for the shows. She also had control over the words used during the shows.
So, Judge Greenbank ruled that it was not indicative of a contract of employment.
What Other Indicators of Self Employment did Helen Prospero have
There were some other indicators which pointed to the Canal Street Productions / ITV relationship being one of self employment.
- She used her own laptop and earpiece
- She didn’t have an office or fixed place of work at ITV
- She did not have an ITV email address
- ITV did not give her an expenses allowance as they did with senior employees
- Canal Street Productions had other customers prior to and after the ITV engagement
- Canal Street used an agent to get other contracts for Helen
- Canal Street Productions would not be paid if Helen was off work for any reason. ITV would have to pay permanent employees sick pay and holiday pay
Was there a Right of Substitution
There was no right of substitution in the contract. ITV would have to provide their own substitute of Helen could not make it in.
However, despite this Judge Greenbank decided that there was no contract of service It was a contract for services. This meant he saw Helen Fospero as self employed.
Why did the judge inflict another HMRC IR35 defeat
HMRC had lost once again. It was yet another HMRC IR35 defeat in the lower tier tribunal.
The courts almost always seem to be on the side of contractors.
It will be very interesting to see what happens when the IR35 reforms are implemented in the private sector in April 2020.
Will HMRC take companies and their big consultancy advisors on in the courts in the same way they are doing with individual contractors?
That could be very interesting.
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