The tax Mr Holmes will be expected to pay has not yet been agreed, although it is speculated to be in the region of £250,000.
Mr Holmes was unable to successfully appeal HMRC’s decision that the contract his company ‘Red, White and Green Limited’, held with ITV during the 2011/12 and 2014/15 tax years belonged inside the IR35 legislation.
It is undersyood that the 'mutuality of obligtion' (MOO) criteria was pivotal in the case. The Tribunal Judge, Harriet Morgan, found that there was 'at least a sufficient framework of control to place the assumed relationship between ITV and Mr Holmes in the employment field' . This was in spite of the 'considerable autonomy' that Mr Holmes had in how he prepared for and presented the popular morning programme.
This bucks the trend of recent high profile television presenters cases against HMRC, where the taxman has usually ended on the losing side of tax tribunals and appeals.
A spokesman for the television presenter said he 'has always considered himself a self-employed freelancer and has never knowingly avoided paying taxes'.
They added that Mr Holmes was 'seeking to comprehend what this means' and wished for 'clarity and consistency across the guidelines' so others don't 'suffer the same confusion' over the rulings.
HMRC said it 'welcomed the judgement' as it oversees how TV stars are paid as freelancers, to make sure employees are paying 'employment taxes' even if they are working for their own company.
Seb Maley from IR35 specialist, Qdos, said: “While this will go down as a rare win for HMRC, it is a result that has stemmed from the needless complexity of the IR35 legislation.
"This is not a typical IR35 case either. And Mr Holmes’ contract with ITV will have been quite different from the vast majority of contractor engagements. With this in mind, contractors, agencies and private sector firms that make well-informed decisions regarding status should not be deterred from engaging in outside IR35 arrangements.
“It’s no secret that HMRC is pursuing high-profile cases ahead of changes to the rules in the private sector. But having already failed to win IR35 tribunals against Lorraine Kelly and Talksport’s Paul Hawksbee in the past year, the tax office still has difficulty interpreting the very rules it designed.”
Further IR35 information
For more information about all aspects of IR35, including the controversial IR35 reforms see Shout99's News on IR35 section.
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Susie Hughes © Shout99 2020