Case has so far had a “significant toll” on the presenter – but HMRC shows no sign of letting up
HMRC has resumed its pursuit of Adrian Chiles over an alleged £1.7m IR35 tax liability, in yet another sign that the tax authority is prioritising compliance activity.
As reported by the Independent, the tax office announced it would appeal against the decision reached at a previous tribunal during a hearing in London last week. At the hearing, Chiles’ lawyers said the case has had a “significant impact” on his mental health.
He is just one of many freelance presenters targeted by HMRC for alleged IR35 non-compliance. Others – including Kaye Adams and Gary Lineker – have been subject to lengthy proceedings and succeeded against HMRC.
HMRC’s intention to continue pursuing the liability comes just weeks after its failed case against Kaye Adams, with the tax authority intent on achieving a statement IR35 win.
Result of previous tribunal
Chiles has been in a long-running dispute with HMRC, dating back to 2012 and concerning a liability comprising roughly £1.25m in Income Tax and £460,000 in National Insurance.
HMRC believes this liability was accrued between the 2012/13 and 2016/17 tax years, over a series of contracts held between his company, Basic Broadcasting Limited (BBL), the BBC and ITV. Chiles disputed this, and a First Tier Tribunal found in his favour in February 2022.
At the time, the judge ruled that Chiles “should be treated as being in business on his own account in all the tax years under consideration”. One of the key factors in this decision was the fact that Chiles had “provided his services as a broadcaster and journalist to a significant number of clients” over a long period.
During the tax years in question and alongside the contracts with the BBC and ITV, Chiles had “entered into 40 separate agreements with some 25 different third parties”. He also “undertook work on other commercial projects” and “turned down other work” during this time, “building a reputation and career working through BBL”.
“Patently unfair” pursuit
As reported by the Independent, legal representatives for HMRC and Mr Chiles made submissions at last week’s hearing.
In written arguments, counsel for HMRC, Adam Tolley KC, suggested that the nature of Chiles’ engagements with the BBC and ITV over the tax years in question were “entirely consistent with a relationship of employment”.
Tolley also suggested ITV and the BBC exercised control over Chiles. In addition, he was engaged for “the entire duration of the relevant tax years” and on “substantial, predictable and long-term contracts”. In HMRC’s opinion, these circumstances “pointed powerfully towards a relationship of employment”.
However, Chiles’ representative, James Rivett KC, said that the decision reached by the tribunal was “sensible and well-reasoned”. HMRC’s decision to appeal the ruling is a “patently unfair attempt, at this very late stage, to run an entirely new legal and evidential argument”, said Rivett.
Rivett also suggested that HMRC’s renewed pursuit of his client would subject Chiles to “more stress… undoubtedly exacerbating his mental health issues”, highlighting the pressure Chiles has faced over his tax affairs.
Also quoted in the Independent, an HMRC spokesperson said: “We appreciate there’s a real person behind every case and are committed to treating all taxpayers with respect.
“We always seek to resolve disputes out of court and only take action to litigate where this isn’t possible.”
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