BBC responds to ContractorUK news story on IR35

The BBC has responded to ContractorUK’s coverage of a statement that the broadcaster put out implying accountants were to blame for not adequately advising its presenters about IR35.

Although the BBC yesterday reiterated that “individuals with a PSC usually engage an accountant and…. their accountant should have been advising them on” IR35, a BBC spokesman acknowledged that the issue was “complex”.

“We have always advised [our] people to take independent advice,” the spokesman said, in response to ContractorUK’s frontpage news item ‘BBC blames accountants for IR35 advice.’

“If we engage someone through a PSC on a freelance basis, they usually get a higher gross fee (with no tax and NIC deductions)”.

'Commercial risk'

This higher gross fee is to “reflect that they take the commercial risk of being freelance, assume responsibility for ensuring they pay the correct amount of tax and NI, and do not receive the enhanced pension and other benefits they would receive as a staff member”.

The BBC spokesman also said that the corporation had annually notified HMRC of how much it paid PSCs which it engaged, including “individuals associated with them.”

He added: “Since April 2017, off-payroll working rules applicable to public sector bodies mean the BBC must now assess the employment status of everyone it engages, either directly or through a PSC, for tax purposes.

“It remains, however, the responsibility of every individual, as it is for anyone in the UK, to pay the right amount of tax on their income.”

'Little HMRC guidance'

But HMRC has a role to play too and its IR35 resources could be improved, the corporation believes.

In a statement, it said: “The BBC has always engaged a large number of freelancers on a flexible basis, altering roles or hours at short notice.

“In almost all cases there has been little HMRC guidance to help clarify the tax status of such roles in the media industry.”

'No evidence of avoidance'

The BBC spokesman pointed out that use of personal service companies “is legal, complies with tax legislation and should not result in any avoidance of the tax or NIC due to the exchequer.”

He said: “The BBC’s use of PSCs was reviewed independently by Deloitte in 2012, which found no evidence of tax avoidance or individuals being forced to move from staff contracts onto PSCs.”

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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