IR35 specialist, Qdos, has responded to the news that Talksport presenter, Paul Hawksbee, has defeated HMRC in an IR35 tribunal carrying around £140,000, describing the taxman’s latest defeat as ‘hugely disconcerting’ as the sector prepares for reform next year.
Qdos CEO, Seb Maley, commented:
“While the result is positive news for Mr Hawksbee, it’s hugely disconcerting that as the creators and enforcers of IR35, HMRC still cannot seem to grasp the legislation it insists on reforming.
“This case raises serious questions about HMRC’s understanding of particular aspects of IR35, with the taxman claiming that all three key status tests pointed to employment. Ultimately, the judge disagreed and the issue of mutuality of obligation – which is completely absent from CEST – was a key factor.”
“The fact that Mr Hawksbee’s engagement would almost certainly be deemed inside IR35 by HMRC’s IR35 tool is yet another indication that it is not fit-for-purpose, despite having been in operation for over two years.
“HMRC has every right to investigate a contractor’s tax status, but it must have a compelling case against them. By challenging individuals who are genuinely self-employed, HMRC places these people under unnecessary financial and emotional pressure.
“With reform to IR35 in the private sector approaching fast, it’s vital that HMRC thinks long and hard about how it enforces IR35 compliance.”