Further confusion in another IR35 case concerning a presenter for BBC Scotland, Ms Kaye Adams.  Ms Adams had worked through her personal services company, Atholl House Productions Limited (Atholl) , as a presenter for BBC Scotland on weekday radio shows while undertaking other freelance opportunities.  Ms Adams has had a long career as a freelance journalist.  As she started spending more time working for the BBC, HMRC held that she was now an employee of the BBC.

Ms Adams, via Atholl, appealed HMRC’s determination to the First-tier Tribunal (FTT) who found that she was self-employed.  When determining that she was self-employed the FTT disregarded a few clauses of the contract between Atholl and the BBC following case law established by the Supreme Court concerning whether the certain people were workers for the national minimum wage laws.

HMRC appealed to the Upper Tribunal (UT) who agreed with HMRC finding that the FTT had erred in law by disregarding the clauses.  The UT remade the FTT’s decision, finding that Ms Atholl was self-employed but for different reasons that the FTT.  When considering whether Ms Adams was self-employed the UT considered the amount of time she worked for the BBC and the long length of her freelance career.

HMRC appealed to the Court of Appeal (CoA) and the CoA has sided with the HMRC that the UT also applied the wrong test.  The CoA held that the UT erred in law by making its decisions on factors around Ms Adams’ working career but the correct test was to determine what the hypothetical contract between the BBC and Ms Adams was.  The UT were correct in rejecting the FTT’s disregarding of certain clauses, as the case law supporting this approach was not relevant to contract construction but rather legislation construction.

The CoA has remitted the case back to the UT for redetermination of the hypothetical contract between Ms Adams and the BBC.  The parties to the litigation will be invited to make new submissions so the UT can reconsider the hypothetical contract.

The decision can be found at: The Commissioners for HMRC v Atholl House Productions Limited – Find case law (nationalarchives.gov.uk)

Please let us know if you have any questions around the determination contracts and whether they would be self-employment contracts or employment contracts.  The penalties for operating a contract as a self-employment where it is considered an employment contract can be quite considerable.