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TV & Film Producer status for tax

TV & Film Producer status for tax

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I have a TV/Film producer client who has a mixture of PAYE income and self employment income as determined by the engager.

For one of the contracts that the client thought was a self emloyed role that they sent invoices for they have also provided 'paylsips' from the engager which I assume are internal documents only to facilitate payment i.e. not sent to HMRC as part of RTI.

They refer to tax category 'schedule D', NT tax code and X NI. They include a YTD 'Employment Statement'.

They also include Ees and Ers pensions contributions to the 'People Pension'?

 Can anyone clarify the position regarding this. Is this something peculiar to TV and Film?

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By Paul Crowley
05th Oct 2020 10:55

NT code is no tax
Common for performers. An employee for all purposes, except tax. Tax is self-employed. It can make NI a bit challenging on the self-employment.

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Replying to Paul Crowley:
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By CWservices6064
05th Oct 2020 11:20

So the pension deductions Ees & Ers would be expected?

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Replying to CWservices6064:
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By Paul Crowley
05th Oct 2020 11:26

Over 20 years since I have acted for a performer
The standard Equity contract ended up as self-employed for tax, Employed on NT coding as employee so both NI due.
Logical to assume that pension now comes in, arising from being treated as a no tax employee.

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By CWservices6064
05th Oct 2020 11:37

This case relates to a 6 month contract as a producer of a single series.

It's the fact that NI has not been deducted as well as no tax that makes me query the pension deductions.

Does this have an impact?

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Replying to CWservices6064:
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By Paul Crowley
05th Oct 2020 18:07

The arrangement you describe is different to the arrangement I dealt with.
The dancer regularly had NI deductions when in shows on an NT code.
No NI makes it a different arrangement

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Replying to Paul Crowley:
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By CWservices6064
05th Oct 2020 19:17

Yes, my thoughts are that both my client and the engager saw this as a self employed role (ESM4115 Producer on 'specific production' for a 'finite period') and that the pension bit has happened in error as auto enrolment is only for employed workers.

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Replying to Paul Crowley:
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By CWservices6064
05th Oct 2020 19:17

Yes, my thoughts are that both my client and the engager saw this as a self employed role (ESM4115 Producer on 'specific production' for a 'finite period') and that the pension bit has happened in error as auto enrolment is only for employed workers.

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By memyself-eye
05th Oct 2020 10:56

If the engager is deducting pension contributions paid to People's Pension then the income is via employment - these are actual payslips.

Maybe his/her 'invoices' were just time sheets?

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Replying to memyself-eye:
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By CWservices6064
05th Oct 2020 11:21

But why use a NT tax code if the engager was treating this as employment?

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By janelm
05th Oct 2020 19:53

I have dealt with this a few times, its prevalent in West End orchestras etc. They used to be NT (no tax) and deducted class 1 NI, but that changed for some around ~2014 and many of them no longer deduct NI (hence letter X). So all of these earnings go on the tax return as self-employed and you pay tax and class 4 NI in the normal way.

Many of them do make pension contributions. I asked clients for their pension statements from the pension provider to try to understand this, and found that the pension contributions shown on 'payslips' are treated as NET contributions by the pension scheme and grossed up for tax, ie these are treated by the pension scheme as personally-paid contributions.

Therefore my solution has been to ensure the pension contributions are included as part of the person's self-employed income (this would be missed if you don't look at the payslips, because it goes direct from the show to the pension). Otherwise the pension contributions would never be taxed, while tax is being reclaimed in the pension scheme. Effectively, the money is part of the performer's income, and then they are making personal contributions to a pension scheme, its just being routed directly and causing confusion.

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Replying to janelm:
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By CWservices6064
05th Oct 2020 20:45

Thanks, that's really helpful.

That was my take on the pension side and this would have been totally missed if the client had not forwarded the 'payslip' as their invoice was for the fee only...........

Does pensions auto enrolment apply in these circumstances or is this some other arrangement?

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Replying to CWservices6064:
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By janelm
05th Oct 2020 21:10

I guess they have most likely done it as a response to auto-enrolment, as on reading the Pension Regulator's website they have potentially a separate definition of 'worker' or at least, you can't rely on the tax definition:

16. The distinction between such a self-employed contractor and a
personal services worker is much debated in employment law and
employers will be used to making the assessment of employee
status for employment rights and tax purposes.
17. However, employers should not rely solely on a person’s tax status
when assessing whether they are a worker. An individual considered
by HM Revenue & Customs (HMRC) as self-employed for tax
purposes may still be classed as a ‘worker’ under the new employer
duties legislation, if they are in fact working under a contract to
perform work or services personally, other than as part of a separate
business of their own.

https://www.thepensionsregulator.gov.uk/-/media/thepensionsregulator/fil...

It gets even more interesting when they are Ltd and VAT registered, get paid weekly and are told to invoice the show every quarter for the VAT, and there are pension deductions on the weekly payslips....

Thanks (1)
Replying to janelm:
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By CWservices6064
06th Oct 2020 11:13

wow.........thanks for this. I've decided to disengage from the minefield!

PM me if you are interested in taking this one on and I'll put you in touch with the client.

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