Tax authority concedes further pursuit of freelance presenter would not be “proportionate”
HMRC has finally admitted defeat in its IR35 case against Kaye Adams, bringing a ten-year ordeal for the presenter to a close.
Ms Adams – who has worked as a freelance presenter for a number of UK broadcasters – was pursued by the tax office over a reported £124,000 IR35 liability.
Over the last decade, the case was heard at First Tier and Upper Tier Tax Tribunals, as well as at the Court of Appeal. Most recently, it was referred back to a First Tier Tax Tribunal, which ruled in Adams’s favour on 29th November 2023.
HMRC had 56 days to appeal the decision – until Wednesday 24th January – but “threw in the towel” a day before the deadline, according to Contractor Calculator.
Speaking to the Financial Times about the decision, an HMRC spokesperson said: “Given this litigation has been ongoing for a number of years and the First Tier Tribunal does not set binding legal precedents, we don’t think it would be proportionate to appeal in this case.”
However, Ms Adams has criticised HMRC for its “mealy-mouthed statement”, accusing the tax office of “gaslighting, textbook gaslighting” in an interview with the Sunday Times.
The case history: a timeline
One of several high-profile freelance presenters targeted by HMRC, Ms Adams was first accused of alleged IR35 non-compliance when engaged by the BBC for the 2013/14 and 2016/17 tax years.
Her case was first heard at a First Tier Tax Tribunal hearing. Adams won this case, though HMRC appealed the ruling, and the case was heard again at an Upper Tier Tax Tribunal. At this stage, the original ruling was upheld.
HMRC appealed the decision again, with the case next heard at the Court of Appeal. Here, the Court referred the case back to the First Tier Tribunal, which ruled in Ms Adams’s favour.
Speaking to Contractor Calculator, Ms Adams said she was both “extremely pleased” with HMRC’s decision not to appeal, and “utterly horrified” at how the tax office had conducted itself over the last ten years.
HMRC “invented” IR35 interpretation
Arguing that HMRC’s actions were “never proportionate”, Adams asked: “Where was HMRC’s concern over proportionality when they appealed to the Upper Tribunal and then appealed again to the Court of Appeal – and then again hauled me over the coals in the First Tier Tribunal for a second time?”
Ms Adams also accused the tax authority – full of “faceless bureaucrats” who are “accountable to no-one” – of “playing fast and loose with taxpayer’s money” and pushing “an interpretation of the law that it has frankly invented”.
Dave Chaplin – founder of Contractor Calculator and CEO of IR35 Shield – had been assisting Ms Adams with her case. “The net tax at stake was £70,000 – so if proportionality was an issue, why did they even bother with the first hearing, let alone the second, the third and the fourth?” Chaplin asked.
“Regrettably, as we have seen in almost all media cases, HMRC never back down, leaving the taxpayer no option but to pay up, or climb aboard the tax tribunal merry-go-round”, he added.
When speaking to the Sunday Times, Adams also described HMRC’s actions as “utterly Kafkaesque”, “aggressive” and “hostile”.
“Three tribunals have found in my favour”, she said. “Could there have been a statement that said, ‘We now recognise that three tribunals have found in Kaye Adams’s favour and actually we will go away and look at how we apply IR35 legislation’?” Adams concluded.
Spare a thought for contractors who cannot afford a Tax Barrister and suffer retrospective and retroactive taxation in the form of the Loan Charge, the unholy spawn of IR35.