Eamon Holmes, provided his services to ITV’s This Morning Show via his personal service company, Red, White and Green Ltd. HMRC argued that this was in effect an employment and therefore National Insurance Contributions and Income Tax were due.
The First Tier Tribunal have decided in HMRC’s favour. Briefly, the key factors highlighted by the Tribunal were:
Mutuality of obligation, Para 226 of the judgement:
“…ITV was required to provide work on at least the specofed dates on payment of the fixed fee and Mr Holmes was required to work on those dates in return
for that fee. On that basis the mutuality test is satisfied throughout the term of each
assumed contract in both of the senses set out in Weight Watchers, namely, that there
was a binding contract in place and that the mutual obligations created under the
contract are sufficiently work-related…”
No right of substitution, Para 259 of the judgment :
“…“service”, meaning the obligation to work, personally, for another, remains “at the heart” of the employer/employee relationship.”
“…Mr Holmes was obliged personally to provide his services to ITV.”
“Mr Holmes was not permitted to assign or subcontract his obligation under the agreements.”
Control, Para 232 of the judgment:
“ITV had overall control over deciding the thing to be done and, in a broad sense,
over the manner in which it was done in that (a) ITV determined the nature of This
Morning and its format and (b) ITV had ultimate editorial responsibility for the
content of the programme (as Mr Holmes expressly acknowledged in the assumed
contracts) and (c) Mr Holmes was required to comply with the guidelines set out by
Para 249 of the judgment
“….ITV had a sufficient framework of control over him to place their assumed
relationship with him in the employment field.”
Their judgement is available in full below.
The key points have been highlighted and annotated, in particular from para 223 onwards.