HMRC alleged he owed £1.2 million in income tax and almost £500,000 in National Insurance but a tribunal ruled that there was ‘no suggestion he set out to avoid paying tax’.
But due to factors including ‘being in business on his own account’ and having multiple clients, the tribunal judge decided that Mr Chiles’ was genuinely self-employed. HMRC can appeal this verdict.
Despite winning the case, Mr Chiles will have to pay his legal fees.
Adrian Chiles is one of a number of high profile television presenters who are being pursued by HMRC, with claims that their contracted work was 'inside IR35'.
Seb Maley from IR35 insurance provider and status specialist, Qdos, said: “This has been a long, drawn-out and no doubt stressful experience for Mr Chiles, who has faced the prospect of a £1.7m tax bill for years. To make matters worse, the BBC insisted that he stop working as an employee and start providing his services as a contractor. On the face of it, this looks to be a situation that he had little control over.
“While HMRC pursuing high profile individuals for vast sums of tax will always concern other freelancers and contractors, it’s important to make clear that Mr Chiles’ working relationship was very different to, say, an IT contractor or freelance marketeer. In our experience, the majority of contractors are able to show they are genuinely self-employed with relative ease.
“Businesses impacted by IR35 reform can learn a lot from this case too. First, contractors can be safely engaged outside IR35 and there is no need to ban them in response to IR35 reform. Secondly, forcing individuals to operate under a particular working arrangement purely for the benefit of the company is short-sighted and could come back to haunt them.”
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 2022