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BBC Presenters chased by HMRC

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    BBC Presenters chased by HMRC

    An interesting topic to watch unfold as "A National Audit Office report revealed that 800 BBC presenters could potentially be asked to pay back tax and suggested the HMRC is investigating about 100 BBC freelance staff." due to their "use of Personal Service Companies enforced on them by the BBC".
    One assumes the BBC will argue that they didn't explicitly tell said presenter how to run their PSC, and if they chose to take large dividends and pay little or no NI contribution then that is their own affair.
    However, if the presenters who face a large tax bill are bailed out by the BBC, are there grounds for IT Contractors, who are forced to use a Limited Co in order to secure a gig (I'm referring to pre-umbrella), to seek compensation?
    I remember my first gig many, many years ago where I was told that I must work through a Ltd Co as the end client would not accept a self-employed person. This has remained the same although umbrella is now an option.
    Thoughts?
    "Hope your doing fine". My favourite opening line in emails from certain agencies! Not only the fact they can't spell, but who actually says that?

    #2
    It's the BBC avoiding the taxes, not the presenters. 13.8% off your wage bill is quite significant, not to mention all the other cost savings. As was pointed out by someone (can't think who... ) in about 2010.

    There is a potential for this to become useful ammunition in the fight against IR35, but given the inaccurate, biased and plain mis-informed reporting I've seen to date I'm not hopeful
    Blog? What blog...?

    Comment


      #3
      The BBC's stance will be that using a PSC is a perfectly legal vehicle.Surely it is up to the individual directly involved with the PSC to determine how its payroll tax affairs i.e. PAYE/NI are dealt with. If the presenters who find themselves being chased by HMRC had paid the necessary taxes then the fact that they've remained in the same job would not be an issue.
      I recall when I first incorporated my Ltd Co and met with my accountant for the first time to discuss PAYE/NI, his sage advice was avoid declaring a teeny salary to avoid NI contributions, rather declare a 'decent' salary (18k at the time), pay the NI contributions as employer and employee, take the remainder in dividends, and hope to keep under the radar of HMRC.
      "Hope your doing fine". My favourite opening line in emails from certain agencies! Not only the fact they can't spell, but who actually says that?

      Comment


        #4
        Originally posted by andyg View Post
        his sage advice was avoid declaring a teeny salary to avoid NI contributions, rather declare a 'decent' salary (18k at the time), pay the NI contributions as employer and employee, take the remainder in dividends, and hope to keep under the radar of HMRC.
        Yep, that’s what I did.
        "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
        - Voltaire/Benjamin Franklin/Anne Frank...

        Comment


          #5
          Me too - until I realised the accountant was talking a load of rubbish, that I had paid several thousands in tax I didn't owe and it was immaterial in heading off an investigation anyway...

          We need to distinguish between using companies for their proper purpose of limited liability (the clue is in the name) and efficient management of a variable income, and employers pushing employees into using them to avoid taxes - which is what the BBC (and many others) have done. The lost NICs - which is what IR35 is all about, not income tax - was saved by the employers, not the workers. The whole attack on the workers originated from HMT, whose staff have no idea of the real world we live in, wrongly advising a naïve chancellor in 1998: they'd tried it before and Thatcher and Major both told them to get lost. Then we got the idiot Blair and the venal Brown in power. The rest is history.
          Blog? What blog...?

          Comment


            #6
            Originally posted by cojak View Post
            Yep, that’s what I did.
            And this is wrong, i.e. tax inefficient.
            Since when is paying more in tax and/or NIC a requirement to stay under HMRC's radar?

            Comment


              #7
              Originally posted by pscont View Post
              And this is wrong, i.e. tax inefficient.
              Since when is paying more in tax and/or NIC a requirement to stay under HMRC's radar?
              When HMRC pick the worst offenders from the bottom of the list and those that have paid some are hiding nicely in the middle surrounded by people that genuinely early around 18k. Not worth unpicking it when they've got a massive list of people who've not paid anything.

              Whether it will work I believe is up for debate but the theory seems pretty sound.
              'CUK forum personality of 2011 - Winner - Yes really!!!!

              Comment


                #8
                Originally posted by northernladuk View Post
                Whether it will work I believe is up for debate but the theory seems pretty sound.
                What's needed is evidence.

                Take a sample of contractors on minimum salary, and a similarly sized sample of contractors on higher salaries. Count the number of investigations in each group.

                Until that's done, all you have is a plausible theory.
                Down with racism. Long live miscegenation!

                Comment


                  #9
                  Originally posted by NotAllThere View Post
                  What's needed is evidence.

                  Take a sample of contractors on minimum salary, and a similarly sized sample of contractors on higher salaries. Count the number of investigations in each group.

                  Until that's done, all you have is a plausible theory.
                  Indeed.
                  'CUK forum personality of 2011 - Winner - Yes really!!!!

                  Comment


                    #10
                    Good to read healthy debate.
                    The main thrust of the initial thread was is there mileage in the argument that contractors have been forced to use a vehicle such as a Ltd Co in order to secure work? And if so, how can this be brought to the fore?
                    "Hope your doing fine". My favourite opening line in emails from certain agencies! Not only the fact they can't spell, but who actually says that?

                    Comment

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