TaxMar 30 2023

TV presenter Holmes loses appeal over IR35 tax bill

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TV presenter Holmes loses appeal over IR35 tax bill
Eamonn Holmes has lost his appeal against HMRC over whether his employment by ITV constituting freelancing (Inkdropcreative, Dreamstime.com)

TV presenter Eamonn Holmes has lost his appeal against HM Revenue & Customs over an IR35 tax case, leaving him liable to pay an unspecified amount in tax.

The case, first heard in June 2018, was to decide whether Holmes was directly employed by ITV between 2011-12 and 2014-15 as a presenter of This Morning, or whether this amounted to self-employment.

The Upper Tribunal’s decision, published on March 29, was that the contract, arranged through Holmes’s personal services company Red White and Green Limited, means Holmes was effectively an ITV employee and therefore should pay the appropriate amount of national insurance and income tax.

Holmes had previously argued that he was "totally freelance" and claimed he had "total control" over how he acted as a presenter on ITV's This Morning show. 

A spokesperson for HMRC said: “We welcome the Upper Tribunal’s judgment, which confirms our position that certain services provided by Red, White and Green Ltd fall within the off-payroll tax rules.

“It’s our duty to ensure everyone pays the right tax under the law, regardless of wealth or status.”

The case is part of a wider crackdown by HMRC over IR35, controversial tax rules that apply to all contractors and freelancers who do not fall under HMRC’s definition of being self-employed.

If a worker comes under the IR35 tax rules, they are treated as employees for tax purposes, so should pay the rate of income tax and national insurance contributions as expected by an employee.

Dave Chaplin, chief executive officer of IR35 Shield, said he believed the overall result for Holmes was wrong in this instance.

“Whilst some very compelling arguments were made, there is limited scope for the Upper Tribunal to interfere with the evaluative judgment of the First Tier Tribunal."

The case was heard days after former footballer and TV pundit Gary Lineker won his case against HMRC, after the tax authority accused him of underpaying nearly £5mn in tax. 

The litigation was in regard to a contract Lineker and his ex-wife Danielle Bux signed with the BBC, which HMRC said tax should have been paid on income earned between June 2013 and June 2016, and a contract between the pair and BT Sport between June 2015 and May 2018.

HMRC is considering appealing the Lineker decision.

Previous cases

A number of other TV presenters have been taken to court by HMRC over alleged unpaid tax.

In January this year Sky Sports pundit Stuart Barnes won an IR35 case, with a judge ruling that he was not liable for a £700,000 tax bill, and last year Radio 5 Live presented Adrian Chiles won a seven-year long tax liability case concerning the payment of £1.7mn in tax.

This was preceded by a number of losses, including fellow former professional rugby player, Michael Lynagh, who had his application for an appeal rejected in December last year, leaving him with a £230,000 tax bill for breaching IR35 rules.

Earlier in 2022, Sky Sports presenter Alan Parry also lost his appeal against HMRC, leaving him with a £356,000 tax bill.

sally.hickey@ft.com