Famous ITV presenter Eamon Holmes faces IR35 probe
by Alan Little
Industry experts from the professional contracting sector have been responding to new reports that the famous ITV presenter, Eamon Holmes, is involved in an IR35 investigation that may result in a £2 million bill.
Mr Holmes, who presents ITV’s This Morning, believes that if the taxman wins, a number of other top ITV presenters will be next in line for IR35 investigations, including Phillip Schofield, Holly Willoughby and Ant and Dec. He restated his status as a contractor with the words: “There is nobody more freelance than me.
Julia Kermode, CEO of umbrella company trade association the Freelancer and Contractor Services Association (FCSA) said that Mr Holmes embroilment in a new investigation illustrates how complicated IR35 legislation really is.
Freelancers, she emphasised, are in a considerably less secure position than permanent employees who enjoy full statutory rights and benefits. The FCSA, she said, disputes claims that personal service companies are tax avoidance vehicles; on the contrary, they are an entirely legitimate means for lone entrepreneurs to operate as sole traders, as they separate business and personal liabilities.
She added: “It is essential that HMRC does not penalise everyone working through PSCs in a blanket fashion as they bring much-needed flexibility to both the freelancer and businesses that engage them on a short-term basis, just as the Lords Select Committee stated in its report in 2014. Employment status is complex and Mr Holmes’ situation is further proof that the Government needs to address this outdated legislation as a matter of urgency.”
Noting that HMRC appeared to be extending its pursuit of presenters from the BBC to the ITV, Seb Maley, CEO of contractor tax advisory service Qdos Contractor, urged HMRC to learn from the mistakes it made earlier this year when targeting BBC presenters. It was the BBC, not the freelancers themselves, that had almost strong-armed these presenters into operating via their own limited companies before the IR35 reforms took effect in April 2017.
Maley said that it was crucial for this case and all others that HMRC assesses the unique particulars of Mr Holmes’ working arrangements and avoid any presumption that a single presenter’s status should function as a template for all contractors engaged by ITV.
Describing the HMRC’s recent pursuit of presenters as a “witch hunt”, ContractorCalculator CEO Dave Chaplin called on the tax authority to stop “harassing the self-employed” with ridiculous, outdated legislation.
Chaplin characterised the original Intermediaries Legislation, which became known as IR35, from 2000 as HMRC’s “ideological invention” of “deemed employees”.
The reality was, he added, that highly-paid freelancers like Mr Holmes paid more tax via limited companies than an employee on the same salary.