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image of football in front of goal | accountingweb | McCann Media IR35 UT ruling
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Football pundit loses £210k in IR35 own goal

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Sky soccer presenter Neil McCann has lost his IR35 appeal against HMRC at the upper tribunal. 

9th Apr 2024
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Neil McCann, a soccer pundit for Sky and formerly a Scottish Premiership football player, has lost his appeal against HMRC in the upper tribunal (UT) based on IR35. McCann, who worked through his own personal service company McCann Media Ltd (MML), also lost at the first tier tribunal (FTT). 

McCann was appointed as an interim manager of Dundee FC for a six-week period during the term of the Sky contracts. 

The FTT had dismissed the appeal against a number of determinations and notices in respect of the tax years 2013/14 to 2017/18 in relation to PAYE and national insurance contributions. HMRC was seeking to recover approximately £210,000 under the intermediaries legislation IR35 (Chapter 8 ITEPA). 

The FTT found that under the terms of the hypothetical contract envisaged by section 49 of ITEPA 2003, McCann could not be considered to be in business on his own account. They further concluded that the provisions of the hypothetical contract were consistent with a contract of employment.

Permission to appeal

MML appealed to the FTT for permission to appeal but was refused. Permission was then granted on limited grounds by the UT, these grounds were:

  1. The tribunal erred in law with respect to the issue of mutuality of obligation.

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Replies (14)

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the sea otter
By memyself-eye
09th Apr 2024 18:38

Interesting that all these cases seem to originate in 2013/14 tax year.
I have seen that myself with an ex client.

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By FactChecker
09th Apr 2024 20:01

Bit of a giant leap there ...
FROM "an extremely complex and technical judgment" (which had some intellectually stimulating points but little of practical relevance to the day-in/day-out cases that pass the way of most of us)
TO it providing "persuasive evidence that HMRC’s view is strong and that of their check employment status for tax (CEST) tool"?
[I presume the garbled final words are suggesting that CEST was somehow shown to be reliable]

Thanks (7)
Replying to FactChecker:
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By Wendy McAngus
10th Apr 2024 08:24

Thanks, FactChecker. This has been updated.

Thanks (1)
By Duggimon
10th Apr 2024 09:40

This is my favourite bit:

“He regularly invoiced the agreed fee in equal instalments, irrespective of the number of games covered in any month, and this continued outside of the football season.”

He was effectively being paid a salary, not a per game fee. While there were other nuances in play it makes the judgement seem, at least to me, a little less complex.

Thanks (8)
Replying to Duggimon:
Ivor Windybottom
By Ivor Windybottom
10th Apr 2024 10:23

I do wonder why HMRC sometimes do not simply pursue PAYE on the work giver, rather than trouble with the IR35 status of a notional contract.

Surely if the worker is a de facto employee then the intermediary company is irrelevant?

This has been how HMRC have tackled the tax schemes where payments to EBT's, EFRBS, etc. were made - they simply said no and that these were payments of PAYE wages.

Thanks (3)
Replying to Ivor Windybottom:
By Duggimon
10th Apr 2024 11:18

I'm not sure if you're aware but the laws were changed in 2017 for public sector companies and 2021 for private sector companies to make this exact change - now they pursue PAYE from the work giver.

It was in the news and stuff.

Thanks (3)
Replying to Duggimon:
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By Paul Crowley
10th Apr 2024 11:56

As easy target. What idiot decided that he was getting an annual fee? Weak as dishwater.

Thanks (0)
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By rememberscarborough
10th Apr 2024 09:49

Wonder if a single mum working a number of jobs could benefit from this tax break….

Thanks (0)
Replying to rememberscarborough:
By Duggimon
10th Apr 2024 09:57

What tax break? The deemed employment has been taxed as employment income.

Thanks (0)
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By listerramjet
10th Apr 2024 11:31

speaking from the clapham omnibus, it does seem that on balance HMRC seek to apply these rules in a way consistent with widening the net of employment, rather than with any regard to the actual substance of the transaction.

Thanks (1)
Replying to listerramjet:
the sea otter
By memyself-eye
10th Apr 2024 18:32

...because they see that everyone should be 'in employment'
It's the civil service mentality that cannot see past the regular monthly pay cheque

not that 'cheques' are used much these days!

Thanks (2)
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By Paul Crowley
10th Apr 2024 11:54

'This is persuasive evidence that HMRC’s view is strong and is tied into that of their check employment status for tax (CEST) tool. Businesses should take note for compliance under the off-payroll working rules.'

Disagree entirely. The CEST tool is not fit for purpose. It can be used to confirm that person is self-employed, as HMRC will not (should not) challenge if used correctly. NOT the other way around.
Seen Lorraine recently?
HMRC usually only look at easy targets. 20% failure rate demonstrates that the recent attacks are better aimed, but HMRC opinion is still not to be relied upon.
Their prior record on IR35 was appalling.

Thanks (2)
Replying to Paul Crowley:
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By Justin Bryant
10th Apr 2024 12:48

That right. Indeed, you could probably be sued for telling clients that HMRC's CEST tool is reliable (as pretty much everyone knows it isn't).

Thanks (2)
Replying to Justin Bryant:
the sea otter
By memyself-eye
10th Apr 2024 18:36

true - it's like using a metric socket on an 'AF' nut. It may work, it may slip off....
I know. I've tried- the sockets not 'cest'....

Thanks (1)