Written by FCSA Business Partner, Larsen Howie
In Oscar Wilde’s ‘The Importance Of Being Earnest’, Lady Bracknell famously says, “To lose one parent, Mr Worthing, may be regarded as a misfortune; to lose both looks like carelessness”. The same can be said of HMRC’s recent successive defeats at the First-Tier Tribunal at the hands of, first, Lorraine Kelly and now Kaye Adams of Loose Women fame – just replace “parent” with “IR35”.
Who is Kaye Adams and why did HMRC target her as inside-IR35?
Kaye Adams has been a freelance journalist since the mid-1990’s and is probably best known for her appearances on the ITV programme Loose Women. She has also appeared on the newspaper review on Sky and has written columns for various national newspapers and magazines.
In 2007, Ms Adams formed her own personal service company (PSC), Atholl House Productions Ltd. It was through this company that she provided her services to the BBC whilst presenting a programme on BBC Radio Scotland called The Kaye Adams Programme, a show that ran for 3 hours on each weekday morning. HMRC claimed that IR35 applied for the four tax years ended 5th April 2017 and raised the necessary tax and NIC assessments. However, shortly before the actual tribunal hearing, HMRC dropped their opposition to the appeal against the years 2013/14 and 2014/15. The total liability for the two remaining years, 2015/16 and 2016/17, was approaching £125K.
What was in Kaye Adams’ contract to suggest IR35 applied?
For the two years in dispute two agreements were in place between the BBC and Atholl House. Each written agreement contained the following main points:
- A minimum commitment of 160 programmes during the term of each agreement, in return for a minimum fee of £155K. Where the BBC required Adams to exceed the minimum commitment, then an additional fee of £968.75 per programme would be paid;
- Assignment or sub-contracting was not permitted but, in exceptional circumstances, a substitute could be appointed subject to prior notice being given to the BBC;
- Adams was required to read and fully comply with the BBC’s Editorial Guidelines and Guidance, and the BBC’s Standards;
- Adams would make herself available to complete such editorial training as the BBC might, from time to time, require;
- Adams would temper her comments when asked to by the BBC;
- The BBC’s editorial control of its content “is final”;
- The BBC could suspend the contract for up to 3 months in the event that Adams brought the Corporation into disrepute with a corresponding adjustment to the minimum fee. Suspension could also arise if Adams became political active;
- At the reasonable request of the BBC, Adams would undergo a full medical examination.
- Adams was not an employee of the BBC;
- Although Adams’ services to the BBC were not exclusive, the Corporation would have first call on her freelance services subject to her having any prior professional commitments. Furthermore, Adams would not work for other third parties without the prior written consent of the BBC, albeit that consent would not be unreasonably withheld;
- Adams would be responsible for providing her own clothing; and
- Atholl House was responsible for all necessary insurances.
In typical fashion, where the facts do not suit their arguments, HMRC’s case relied heavily on the contractual terms.
This article was written by and are the views of Larsen Howie.