name: ir35 webinar 16 04 2019.mp4 jenny henderson … · 2019-04-30 · clip: ir35 webinar 16 04...

Clip:IR35Webinar16042019.mp4

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Name:IR35Webinar16042019.mp4

JennyHenderson 00:00:03:02Goodmorning,everybodyandwelcometothiswebinaronIR35.MynameisJennyHendersonandI'mHeadofTaxattheBBC.I'mjoinedbyMarkGroomandEmilyPlumbfromDeloittewhowillbetakingusthroughtoday'ssession.Theywillintroducethemselvesproperlyinamoment.I'djustliketogothroughtheagendafirstofall.We'regoingtocoverthebackgroundtoIR35andwhywearewherewearerightnow,theprotectiveassessmentsthatHMRChaveissuedorastheyaresometimesknownRegulation80determinationsandIunderstandthatsomepeoplehavealsoreceivedSection8noticesfornationalinsurancepurposes.We'lltalkalittlebitabouttheproposedsettlementthattheBBChasbeentryingtoreachwithHMRC,we'lltalkaboutnextstepsandfollowupwithquestionsandcontactdetails.

JennyHenderson 00:00:55:07Aswegothroughthesessionpleasecouldyoutypeinanyquestions,ifyou'vegotanyqueriesorwanttocheckorchallengeanythingwhichthat'sbeensaid,ifyoucantypethoseintothescriptboxonyourscreensandwe'llgothroughtheseattheendofthesession.Couldyoualsoflagifyou'vegotanytechnicalissuesandwe'lltrytoresolvethoseaswell?ImeantechnicalITissuesnottechnicaltaxissues.Hopefullyeveryone'sOKwiththat.I'vealsobeeninformedthereisabuttononthetoprighthandsideoftheslideboxandifyouclickonthatyoucanexpandthesizeoftheslidessothattheyaremorevisible.It'sprobablymoreimportantlateroninthepresentationwhenwe'vegotsomenumbersanditmightbehelpfulifyoucanseewhattheysay.

JennyHenderson 00:01:46:02TherewillbearecordingofthissessionavailableonthewebinarfromtomorrowandwewillcirculatealinktothatwebinarsothatyoucanwatchitagainorshareitwithyouraccountantandadvisororifyouwanttopassitontootherpeoplewhoyouknowmaybeaffectedbythisissueattheBBC.That'sallfrommefornowI'mgoingtohandovertoMarkandEmilyfortoday'ssession.


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MarkGroom 00:02:15:07ThankyouJenny.Goodmorning,everybody.MynameisMarkGroom,I'manemploymenttaxpartneratDeloitte.IspecialiseinemploymenttaxandIR35issues.I'vebeensupportingJennyattheBBCandpresentersformanyyearsnow.IwilljustkickoffbeforehandingovertoEmilywithabitofthemesetting,explainingthebackgroundofwherewe'vebeenandwherewearenow.

MarkGroom 00:02:37:06So,firstofallthepositionupuntilApril2017,hasbeenthatpersonalservicecompanieshavebeenresponsiblefordeterminingifIR35legislationappliestothemandifitdoes,thentheyareresponsibleforoperatingPayasYouEarnandnationalinsurance.HMRCopenednumerousinquiriesintotheemploymentstatusorpersonalservicecompaniesnotjustinthemediaindustriesbutacrossmanyotherindustries,too.Soitwasn'tjustaBBCissue,soforexample,IT,constructionandhealthcarewhereotherindustriesimpacted.SomepresentershaveopenenquiriesinrespectoffeesearnedfromtheBBCthroughouttheperiodupuntilApril2017.

MarkGroom 00:03:22:13ThenfromApril2017onwards,theruleswerechangedslightlyandthepublicsectorversionofIR35wasintroducedwhichimpactedtheBBC.WhatthatbasicallysaidwasthattheBBCbecameliableforthePayasYouEarnandnationalinsuranceandfordeterminingemploymentstatusratherthanthepersonalservicecompanies.AtthesametimetheRevenueintroducedanonlinestatusassessmenttoolcalledCEST;CheckEmploymentStatusforTax.

MarkGroom 00:03:54:00FromApril2020thisregimeisalsogoingtoberolledouttotherestoftheprivatesector,soeveryoneintheUKwillbesubjecttothenewrules.AllengagedaspersonalservicecompanieswillhavetodotheseassessmentsofemploymentstatusinrelationtoworkwhichishiredthroughPSCsandwillhavetodetermineifPayasYouEarnandnationalinsuranceareduewheretheworkersaredeemedemployed.


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MarkGroom 00:04:21:03Sotheworkundertakentodateinrespectofthis,isthatsofariswe'vebeentryingtonegotiate,theBBChasbeentryingtonegotiate,Deloitte'shasbeentryingtosupporttheBBC,tonegotiateasettlementtobringalloftheseenquiriestoanendandtorestorenormalitytopresenterstaxaffairs.It'shugeandcomplexexercise,andithastakensometime.WehopetoagreeasmanyBBCrolesasself-employedaspossible.Inevitably,therewillbesomerolesthatHMRCsimplywillnotagreeasself-employedandwillseektoinsertemployedstatusandthenPayasYouEarnandnationalinsuranceisdue.

MarkGroom 00:05:03:12ThatinitiativeisaccompaniedbyamediaindustrywideinitiativetoprovideupdatedguidanceonHMRC'swebsiteastohowtodetermineemploymentstatusforroleswithinthemediaindustry.Thatincludesinfrontofcamerarolesandbehindcameraroles.Also,actorsandtheatricalartistsaswellaspresenters.

MarkGroom 00:05:26:08Sothat'sabitofbackgroundandIwillnowhandovertoEmilytoexplainwhereweareinrelationtotherecentspoutofRegulation80determinationsthatHMRChasissued.

EmilyPlumb 00:05:38:03Thanksverymuch,MarkandjustasaquickintroductionI'mEmilyPlumbanAssociateDirectorworkingalongsideMarkintheDeloitte'semploymenttaxteam.IfwecarryoninjustintermsoftheRegulation80determinationsyoumayhaveheardinthepastthesereferredtoasassessmentsratherthandeterminations,it'soneandthesame.WeunderstandthatsomeofyouhavereceivedthemfromHMRCoverthelastcoupleofweeks.


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EmilyPlumb 00:06:38:10Justtokickitoff,whatisaRegulation80determination?WhenHMRCthinkstaxisdueonanindividual'sincomefrompasttaxyears,theycanissueadeterminationwheretheywanttocollectthattaxduebuttheyarenotquitesureyetwhatamountthatwouldbe.Sowhatthey'vedoneoverrecentweeksisissueprotectiveassessmentswewouldexpectinrelationtothe2014-15taxyear.Thereasonforthatisbecauseundernormaltaxlaw,HMRCcanrecoverunderpaidincometaxforfourclosedtaxyears.Assomeofyoumayknow,we'vejustgoneintoanewtaxyear,the2019-20taxyearfromthe6thApril.Therefore,the2014-15taxyearasthenowfifthclosedtaxyearifyouworkbackwardshasbecometimebarred.SowhatHMRCdointhesecircumstanceswheretheythinkthereisstilltaxtocollectinrespectofayearthat'sgoingtogooutoftimeistheyissuetheseprotectiveassessmentswhichfortaxdueunderIR35areknownasRegulation80.

EmilyPlumb 00:07:33:08YoumayhavethequestioniftheBBCisindiscussionsaboutasettlementwhyhasHMRCstilldonethis?Thesamereasoningappliesreally,eventhoughthesettlementisunderdiscussion,thetaxinrespectof2014-15taxyearwouldstillfalloutoftime,iftheyweren'ttoissuetheseassessmentsasthesettlementhasn'tyetbeenagreedandfinalised.AsthesediscussionsareongoingHMRChasissuedthesetoprotecttheirposition.

EmilyPlumb 00:07:43:07Ifyou'vegotaRegulation80infrontofyouandyou'rethinkingwherehavethesenumberscomefrom?TheymaybefamiliartoyouoritmaybeHMRChaveusedabestestimateandtheyareallowedtodothatwhentheyareissuinganassessment.Wheremaytheyhavegotthosefiguresfrom?Thekeyplaceswouldbeyourpersonalservicecompanyaccounts,assumingyou'vebeenengagedviaapersonalservicecompany,you'repersonalservicecompanytaxreturns.AlsotheBBC'srequiredtosubmitaSchedule23returneachyearwhichisjustascheduleofallthegrosspaymentstheyhavemadetoPSCsthroughoutthetaxyear.Sothat'swherethefiguresmayhavecomefrom.


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EmilyPlumb 00:09:34:03SoifwemoveontolookingatanexampleRegulation80whetheryou'vereceivedonealreadyoryouhaven'treceivedonebutyougetonethroughthepost,whatyoumightexpecttoseeonthereandthekeybitsofinformationonthere.Towardsthetoprighthandcorneryou'vegotaboxthatsaysyear,wewouldexpectthattorelatetothe2014-15taxyear.Onlythatbeingbecausethat'stheonewhichhasjustgoneoutoftime,soHMRCwillhaveissuedthemtoprotectthetaxtheythinkmaybeduethere.

EmilyPlumb 00:09:54:00Anotherkeypieceofinformationontherewhichwewillcomeontoinmoredetailshortlyisthedateofissue.Thereasonwhythat'ssoimportantisbecauseifyouchosetoappealyou'reRegulation80determination,youneedtodothatwithinacertaintimelimit.Usually30days.Soit'simportantyouknowwhatthedateofissueisratherthanthedateyoureceiveditincaseitgotdelayedinthepostbecausethat'skeytoworkingoutwhenyouneedtoappealby.

EmilyPlumb 00:10:11:12Towardsthebottomyou'vekindofgotthattablewiththestatementoftaxdue.We'veputsomeillustrativefiguresintherewhichMarkwillcomeontolaterandshowyouexactlyhowthosefiguresmayhavebeenarrivedat.Thekeythingstodrawoutatthisstagearethatinthesecondcolumnthereisacolumnforpaywhichtaxremainsunpaid.ThatwillbetheamountthatHMRCconsiderstheindividualhasreceivedfromtheBBCforthetaxyearinquestion.Youneedtomakesureyouarehappywiththatnumberandifyou'renotthatcanbeagroundsforappeal.ThemostinterestingnumberorthemostimportantnumbertoyouwillbetheoneinthefarrightwhichisthetaxthatHMRCconsidersisduebasedonthefeesreceivedfromtheBBC.ThatwouldbetheamountthatultimatelybecomespayableifnoactionistakeninrespectoftheRegulation80.


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MarkGroom 00:10:45:00SoEmily,justonthatpointyoumadeonthedateofissue,IthinksomepeoplewillbereceivingtheseReg80sinAprilafterthe6thApril,i.e.thestartofthenewtaxyear.JusttobringoutthatpointtheRevenueneedtohaveissuedtheReg80bythe5thAprillatestotherwiseit'stoolateandthatwouldbeagroundsforappeal.Theassessmentwouldhavebeenraisedincorrectly.Youmaywellseedateofissuebefore5thAprilbutyoumaywellofreceiveditinthepostafterthe5thApril.Thatwouldstillbeavalidlyraiseddeterminationwhichyouwillneedtoappealthroughtheprocesswewilldescribeshortly.

MarkGroom 00:11:09:07Justoneotherthingonthefigures.ThesearethefiguresHMRCcalculatesontheBBCincome.Theyshouldn'tbecalculatedonanyothersourceofincome.TheyshouldjustbeBBCincomeinthattaxyear2014-15.ItwillbethegrossamountofthePayasYouEarnthatHMRChascalculated.Theywillnottakeintoaccountofanyoffsetsthatmightbeavailabletoyou.Whenyoufirstseethetaxfigureyoumaythinkthat'swaytoomuch.There'snowayIowethatmuchtax.Thatwouldbeaperfectlyreasonablereactionbecauseyouareentitledtooffsetsofthetaxesyou'vealreadypaidoutforcorporationtaxandonanydividendsthatyou'vereceived.Wewillexplainhowthoseoffsetsworklater.Justtoflagwhenyoufirstgetthisandyouopenitandseethattaxfigure,itmaycomeasabitofashockbutitwon'tnecessarilybethefinalfigureyouhavetopay.You'llgetthebenefitofthoseoffsetsoncethecalculationsarefinalised.

EmilyPlumb 00:12:45:03IntermsofoptionsindealingwithaReg80determinationoractuallyasJennymentionedforthoseofyouwhohavealsoreceivedSection8noticeswhicharethenationalinsuranceequivalentoftheRegulation80.Regulation80sdealwithincometaxandSection8sdealwithyournationalinsurance.


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EmilyPlumb 00:13:11:03Therearefromwherewe'restandingthreemainoptionsthatyoucantake.ThefirstoneistoappealtheRegulation80ortheSection8whichyou'vebeensent.Now,whenyouappealyoucandotwothings.Thefirstoptioncoversappealandpostpone.Nowthereasonwhyyouwoulddothis,isyoucanappealyourRegulation80butifyoudon'talsorequestthatHMRCpostponethetaxcharge,thetaxthatiswrittenonyourRegulation80stillbecomespayablewhilstyourappealisbeingdealtwith.It'spossibleyouwouldwanttoappealandpostponethattaxchargeuntiltheappealprocesshasbeenconcluded.

EmilyPlumb 00:13:24:11ToappealyouwouldfollowtheinstructionsonyourRegulation80notice.Ingeneral,thatwouldbetoreplytoHMRCinwritingwithin30daysoftheissuedateoftheRegulation80.It'sreallyimportantthatwhenyoudothatyoustatethegroundsofappeal.Therearequiteafewdifferentgroundsofappealthatyoucoulduse.SomeofwhichMarkwillcoverlateroninthewebinar.It'skeythatyouhavethosethings,soit'sinwriting,within30daysofthedateandyoustateyourgroundsofappeal.Ifyoudon'tdoallthreeofthosethings,thenunfortunatelyyourappealwon'tbevalidandyouwillhavemissedthechanceifthe30daysareup.That'sappealandpostponementbecauseyou'verequestedtopostponethetaxchargeaswell.

EmilyPlumb 00:13:25:00Thesecondoptionwhichisverysimilar,istoappealthenoticebutnottorequestthatHMRCpostponethetax.Nowthisisanalternativeifyoueffectivelywanttomakeapaymentonaccountforanypasttaxyouthinkmaybedue.Thatstopsanyfurtherinterestaccruing.Whereataxliabilityarisesthatgoesunpaid,HMRCisabletochargelatepaymentinterestonthatamount.Ifultimatelyataxliabilityisduebymakingapaymentonaccountyoucaneliminateanyfurtherinterestaccruing.It'sreallyimportantthatyouonlydothatwhereyouaresurethereisgoingtobesometaxdueoratleastanamountoftaxwhichisabouttheamountyouaregoingtopayonapaymentontheaccountotherwiseyou'regoingtobeoutofpocket.YoumaybeabletogetthatbackfromHMRCatalaterdatebutthesethingsalltaketime.So,usuallyifsomeoneisgoingtoappealanoticetheywouldappealandrequestpostponementofthetax,butjusttoletyouknowthereisthatoptionforyou.


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EmilyPlumb 00:15:07:06Thethirdone,ifyouwanttoyoucanaccepttheassessmentandsettletheliability.Wewouldonlyrecommendyoudothatifyou'reabsolutelysurethatIR35didapplytotheincomethatyoureceivedfromtheBBCforthetaxyearinquestionandthattheamountsquotedarecorrect.ItmaybethatyoufeelonreflectionIR35shouldhaveappliedandthereisataxliabilitytopaybutyoualsodon'twanttobesettlingonthebasisofsomebestestimatesfromHMRC.Youdefinitelywanttoeithercheckyourselforgetyouradvisororaccountantinvolvedtomakesurethoseamountsquotedarecorrect.

MarkGroom 00:16:07:10SojusttoaddEmily,themiddleoptiontoappealanddon'tpostponeisfairlyrare.Wedon'treallyseethatveryoften.Insteadforpeoplethatwanttocutoffanypotentialinterestcharge,theywouldnormallyjustputthemoneyinthebanksotheywouldearnanyinterestandthatwouldoffsetanyinterestthatHMRCmaychargebecauseonceyou'vehandedoveryourmoney,possessions90%ofthelaw.Itwouldbehardtogetitback.Wefindmostpeopletendtoappealandpostponeandtheysettleupthetaxattheveryendoncethefinalfiguresareagreed.

EmilyPlumb 00:17:04:10ThanksMark.Sojusttoemphasisewhyit'ssoimportanttoappealontheRegulation80ortheSection8ifyoudon'tthinkeitherthefiguresarecorrectorthatyoushouldhavebeenissuedoneinthefirstplace.Firstly,ifyoudon'tappealandyoujustputtheRegulation80inadrawerandforgetaboutitthenthenumbersonthatRegulationwillbecomefinalandHMRCwillexpectyoutopaythetaxthattheyconsiderdue.Thatmeansthataswe'vementionedalreadytheseareprotectiveassessmentsonthewholewhichmeansHMRChasgivenabestestimateofwhattheythinkyouareyourPSCmayowe.Ifthattaxliabilitycrystallisesyoumaybepayingmoneyoverwhereeithertheamountiswrongortherewasnotaxdueinthefirstplace.


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EmilyPlumb 00:17:09:03Therefore,recappingonthelastslidewewouldrecommendyoudoappealtheRegulation80orSection8whereyou'renotabsolutelysurethattheamountsontherearecorrectandthatIR35didapplytoyou.AlsobecausetheBBCsettlementdiscussionsarestillongoing,asMarkmentionedwearetryingtoagreewithHMRCthatasmanyastheBBCrolesaspossibleareofaself-employedstatus.Itmightbethatifyouchoosetosettleatthisstage,youaresettlingunnecessarily.Itmaybethataspartofthesettlementitisthenagreedthatyourjobroleorjobcategoryisactuallyofaself-employedstatus.AlsoifyouappealandaresuccessfulwiththatappealyoucanalsochoosetohaveanyliabilitythatisdueevenwhereyourrolebecomesanatriskroleandthereforeIR35appliestobesettledunderthecentralsettlementratherthanhavingtogothroughthatprocessofsettlingitindividuallyyourself.

MarkGroom 00:19:02:09Justonelastpoint,ifanyoneisabitnervousaboutappealing,thenthere'sactuallynothingtolosebecauseyoucanwithdrawyourappealatanytimeatsettleup.IfyoustartoffthinkingIwanttoappealthis,I'mself-employedandthenlateronyoudiscoverthatactuallythatmightbewrong,youwanttosettletheassessmentandpayup,thatisabsolutelyfine.Youcandothatanypoint.YouwilljustwritetotheRevenue,withdrawyourappealandputthemattertobed.ThebeautyofappealingisthatyougetthechancetodiscussthingswiththeRevenue,orfortheBBCcandiscussthingswiththeRevenueandtrytoresolvethingsinyourfavour.

MarkGroom 00:19:37:08Soletsjustlookatthegroundsofappealthatmightbeavailabletoyou.We'vejustlistedsixexamplesbuttheremaywellbeothers.It'sreallyimportantyoujustselecttheonesthatapplytoyou.Youshouldn'tselectgroundsthatdon'tapplytoyou,thatarenotrelevanttoyou.It'simportantthatyoudothisbecauseifyoumakeanappealwithoutgoodgroundsoronincorrectgrounds,youcanputyourselfinapenaltyposition.Onlyusethegroundsthatarerelevanttoyou.


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MarkGroom 00:20:12:14Thefirstonewouldbethatsimplyyoudon'tconsiderIR35appliestoyoubecauseyouconsideryou'reinaself-employedrole.Therefore,you'vepaidyourtaxesundercorporationtaxanddividendtax,youdon'tthinkyoushouldbepayingPayasYouEarnandnationalinsuranceinstead.That'sbasicallythefirstgrounds.It'sacomplicatedstatement.Inonesentenceitsumsupawholeraftofissuesrelatingtoemploymentstatus,soyouhavetohavedoneyourhomeworkandbefairlysureyouwouldpassthetestofselfemploymenttomakeatoneofyourgrounds.

MarkGroom 00:20:46:10Thesecondonewouldbethatactuallyforthoseofyouwhoarealreadyinanopeninquiryorthoseofyouwhohaveneverbeeninaninquiryandarewonderingwhyyou'vegotthisassessment,youcouldactuallysayhangonaminute,IunderstandthatHMRCareonlyentitledtoraiseanassessmentwhennewinformationcomestolightthatcausedthemtobelievethatIR35shouldapply.Whatisthisnewinformation?IfHMRChaven'thadanynewinformation,thenreallythereisnogroundsforraisinganassessment.That'sfair.That'scalleddiscovery.Youcanusethatasagroundsifyoubelievethereisnothingnewtohavecausedachangeinastatusyouthoughthadalwaysapplied.

MarkGroom 00:21:27:09ThethirdgroundsisjustsimplyasEmilysaidearlier,thefiguresappearestimatedthatyoudon'trecognisetaxamounts.Theydon'tlookrighttoyou.Theylooklikeestimatesandthatisavalidgroundsofappeal.

MarkGroom 00:21:45:02Thefourththing,isnotsomuchofagroundsofappealasawayofhandlingtheappealbutwerecommendyouincludeitanyway,ifyouproposetogothisroute.Ifyou'rehappytogowiththeBBC,tojoinintheBBC'ssettlement,whichwe'regoingtocometoshortly,thenyoumaystatethatyouwishforyourappealtodealtwithcentrally,undertheBBC'sproposedsettlement.ThatwillpreventanyfurtherquestionsorcorrespondencewiththeRevenuebecauseitwillallbedealtwithcentrallyforyoubytheBBC.


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MarkGroom 00:22:18:13Notonlymightthetaxfiguresappearestimatedbutthefees,theBBC'sfeesintheassessmentmightalsobeestimatedandthatwouldalsobeagroundsofappeal.

MarkGroom 00:22:33:10Finally,numbersixisthatifyou'reinRadioandyoubelievethatyoumeettheconditionsoftheRadioIndustryGuidelines,thatalsomaybeavalidgroundsofappeal.Nowjustawordofwarningthere,wedoknowthatHMRCstronglydisagreewiththat.Theydon'tthinkthatpeoplecanrelyontheRadioIndustryGuidelines,butourviewiswhenthereisanindustrypracticebuiltupoveralongperiodoftimethenthatisavalidgroundsofappeal.Youwillneedtohavebeenawareofthemandyouwillneedtobeabletoshowyoureliedonthem.Ifyoudidn'tdoeitherofthosethingsthendon'tincludethatasoneofyourgrounds.

MarkGroom 00:23:12:08Sothosearejustsixexamples.Youmayhaveothergroundsofappealandyoushoulddiscussanyotherpossibilitieswithyourownpersonaltaxadvisor,accountantorlawyer.

MarkGroom 00:23:23:00Soonthenextslide,justtosortofbringoutthispointabitmore,ImentionedearlierthattheReg80sarethegrossamountofPayasYouEarnthatHMRCwouldliketocollectbeforeoffsettinganyothertaxesthatyou'vepaid.Sowhatoffsetsmightbeavailabletoyou?ThefirstonemightbethatifyourpersonalservicecompanyhaspaidcorporationtaxonyourfeesreceivedfromtheBBCin2014-15,whentheamountofBBCfeesistreatedasemploymentincomesubjecttoIR35,that'swhatwe'retalkingabout.Whenthathappens,thenyourPSCisentitledtoclaimaCorporationTaxdeductionforthatemploymentincomeforthoseBBCfees.Itdoesn'tgettaxreliefonthePayasYouEarn,itgetstaxreliefontheBBCfees,soamuchbiggerfigure.TherateofCorporationTaxreliefin2014-15applicabletoyou,timestheBBCfeesisveryroughlythesortofrepaymentoroffsetyourentitledanditwasabouttwentyonepercentin2014-15.Thatwouldbethefirstoffsetyouwouldbeentitledto.


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MarkGroom 00:24:30:03Thesecondoffsetyou'dbeentitledtoisthatifyouhavepaidtaxondividendsyoutookfromyourPSC,soIncomeTaxondividends,orDividendTaxwecallitforshort,thenyouareentitledtohavethattaxrepaidtoyoubecausethetaxisgoingtobecollectedthroughPayasYouEarninstead.Youdon'tpaytaxtwiceonthesameincome.YoupayyourPayasYouEarnontheBBCfees,thenyougetyourDividendTaxbackandthatcanalsobeoffsetagainstyourPayasYouEarn.

MarkGroom 00:25:11:05IfalltheCorporationTaxandDividendTaxwhenaddedtogether,comesbroadlytothesamefigureasthePayasYouEarn,youmayfindyou'vegotnothingtopayatall.Youmayevenfindinsomecases,we'vefoundthatyoucouldbeinarepaymentsituation,butequallywehavefoundothercaseswherethereisabalanceoftaxtopay.Soit'snotreallypossibletogiveyouanysortofconfirmationoradviceonthiswebinarbecauseitdependsverymuchonyourownpersonaltaxpositionandhowmuchtaxyou'vepaidthroughyourvarioustaxreturns,yourPSCreturnandyourselfassessmentreturnofyourpersonalincometax,butonceyou'vedoneallthosecalculationsandcheckedwhat'savailabletoyouandcalculatedtheoffsetthat'savailabletoyou,it'sthenetamountthatwe'retalkingaboutasbeingfinallyduetoHMRC.Ifyouchoosetosettleyourassessmentbyyourself,whatyouneedtodoistomakeseparateclaimsforthoseoffsetsandyoumustclaimthecorporationtax,ifIrefertoitasCT,that'sfromhabitthenI'mtalkingaboutCorporationTaxorDTDividendTax.Youmustmakeseparateclaimsforthosetaxestobeoffset.Youcanincludethoseclaimswithyourassessmentotherwisespeaktoyouraccountantabouthowtomakethoseclaims.IfyourequestthatyourassessmentisdealtwiththroughtheBBCCentralSettlementprocessthenHMRChasalreadyagreedthatitwillhandlethoseoffsetsforyou.TheywillrequirethatyousignapieceofpapertosaythatyouauthorisetheoffsetstobecalculatedandtobeallocatedagainstthePayAsYouEarnbutthatprocesswillbemuchsimplerbecauseitwillallbehandledcentrallyandallyouwillhavetodoistosignabitofpaper.


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MarkGroom 00:26:56:01SothatsortofleadsnicelyintotheBBCsettlement.WhatisactuallybeingproposedinrelationtotheBBCsettlement.WellfirstofallitisasIalludedtoontheslidejustnow,itisacentralsettlementprocessthattheBBCistryingtoagreewithHMRCcoveringallfouryears,from14/15-17/18.IfthatprocessisagreedasIexplainedjustnow,youwillhavetheoptionofeffectivelyaskingforyourassessmenttobesortoffoldedintotheBBCCentralSettlementratherthanhavingtodealwithityourself.Sowearetryingtomakelifeveryeasyandconvenientforeveryone.TakeawayalltheadminandallthathandlingofHMRCcorrespondencefromyouandsortitalloutcentrally.NowtheBBCwillaimtodeterminewhetherornotIR35appliesbyreferencetoanumberofrolesand27separateroleshavebeenidentifiedandthenwe'lltryandsaywhethereachoneofthoserolesiseitheremployedorselfemployed.That'stheidea.Thiswillbedoneonawithoutprejudicebasis,soitwon'tbeapplicableforanyotherpurposeatall.ItwillbeapplicablesolelyforthesefouryearsandsolelyforthepurposeofbringingaconclusiontothetaxstatusofPSCsuntil2017/2018.IfIR35appliestheBBCwillmakeacontributiontowardsthatfinalIR35liability.We'llgiveyousomeexamplesofhowthatcontributionwillbecalculatedanditwillbepaidunderthecentralsettlementdirectlytoHMRC.

MarkGroom 00:28:47:00Ifyouhaveappealed,andaredealingwithyourassessmentoutsideoftheBBCcentralsettlementandaredealingwiththisbyyourself,personally,thenthatpaymentwilleitherbemadetotherevenueoritmightbemadetothePSC.Itjustdependsonyourparticularcircumstances.Buttheimportantthingtonoteisthatpaymentisonoffer.Weshouldhavearouteyougodown.Soyou'vegotcompletefreedomtochooseBBCCentralSettlement,personalappealandpersonalsettlementandtheBBCwillstillbepreparedtomakeacontribution.Thatcontributionwillbedeterminedbasedonasetofprinciplestoensurethatitisfairandconsistentforeverybody.Becausetaxissocomplicatedanddependsonalotofpersonalfactorsandpersonaldecisionsyoumakeinrelationtoyourownaffairswhichcan'tbetakenaccountofintheprocess.We'vehadtomakesomesimplifyingassumptionsthatarestandardforeveryoneandthatkeepsthingsconsistentandfair.


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MarkGroom 00:29:48:10Sobeforewegetintoanexample,wehaveacoupleofexamplescomingupshortly.Let'sjustsortofexplainwhathappensacrossthevarioustaxyears.It'salittlebittaxtechybutIthinkit'simportantforyoutoknowandmighthelpwithyourunderstanding.We'llstartwiththeeasybit.Foranybodythat'sengagedasasoletrader,sonotthroughaPSC.YoujustengagedirectlywiththeBBC.ThentheBBCwillbeassesseddirectlyandtheBBCwillbeliableforanyPayAsYouEarnandNationalInsurancedueonanybodythatisconsideredtobeemployed.SoyouseeintheouterboxundersoletradersyouseeBBCashighlightedasbeingliableandalsothough,totheleft,inthesortofLthatbranchesofftothelefttheBBCisalsoliabledirectlyforanypersonalservicecompaniesinrespectoftaxyear2017/18onlyandsoPSCsin17/18allsoletraders,thatwillallbepickedupcentrallybytheBBCanyway,youdon'thavetodoanything.Youwon'tgetanassessmentinrespectto17/18.ItwillallbehandledbytheBBC.

MarkGroom 00:31:04:09It'stheearlieryearswhereyoumaygetanassessmentandwealreadyknowthat14/15hasbeenassessed.That'swhatwe'vebeentalkingaboutsofar.Wedon'tneedtogooverthatgroundagainbutforthemiddletwoyears15/16and16/17,youmaybethinkingsowhat'sgoingtohappentothosetwoyears.Well,wehopeinthenextcoupleofmonthstohaveconcludedatleastinprinciplethetermsofthesettlementfromHMRCsohopefullynothingwillhappentoyoupersonallyinthosetwoyears.Everythingwillbeagreedcentrally.Howeverifyoudon'twanttotakepartintheBBCCentralsettlement,thenthosetwoyearswilleventuallybeassessedbyHMRCthere'snowheretohidefromthosetwoyears,theywilleventuallycatchupwithyouandtheywillissueasettlementandyouwillhavetogothroughthatprocessyourself.ButofcourseyoucanalwaysjointheBBCsettlementandhaveitdoneforyou.


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MarkGroom 00:31:59:12Solet'sstarttolookattheprinciplesofthesettlementthentoensureconsistencyandfairnessforeverybody.Soonthelefthandsidewe'vehighlightedthreeofthemainprinciplesthataregoingtoapply.ThefirstisthatalltheBBCfeesearnedinataxyearandreceivedbyyourpersonalservicecompany,afterpayingcorporationtaxonthosefees,theyarepaidoutasDividendstoyouinthesametaxyear.Thatwillbethefirstprinciplethatwehavetoapplytoeverybodytomakesurethatthetaxiscalculatedfairlyandconsistentlyforeveryone.

MarkGroom 00:32:37:00Thesecondone,theBBCfeespaidtothePSChavebeenpaidouttothepresenterandnooneelse.Nowsomepresentersmayhavespousesandmaypayoutthosefeesasdividendstotheirspouseortoothersortheymaypaywagestopeoplethathelpthemintheirworksothatisallpersonaltoyou.ItisnothingtodowithIR35.Sotheassumptionthatwehavetomakeisthatallthefeeshavebeenpaidouttoyoupersonally.

MarkGroom 00:33:07:00Thethirdmainassumptionisthatyouareentitledtoapersonalallowance.Nowobviouslyeverybodythathasearningsover£100,000,thatPersonalAllowancestartstoabateanditdropsdowntozeroeventually,sothatisalltakenintoaccountaswell.Theworkingassumptionwillbethatyou'reentitledtoitunlessyourearningsaresohighthatthatpersonalallowanceisabated,andsowiththosethreeassumptionsweproceedtoworkoutwhatthePayAsYouEarnandNationalInsurancewouldbeunderIR35.Imentionedvariousotherpersonalfactorsandpersonalchoicesthatyoumaymakeinrelationtoyourowntaxaffairs.That'stotallyok,that'sentirelyuptoyoubutthepointhereisthatit'sgotnothingtodowithIR35.


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MarkGroom 00:33:51:10Let'sgiveyouafewmoreexamples.Imentionedpaymenttospouses,thatmaybeonechoiceyoumayhavemade.Somepeoplemayhavetakenloansfromtheirpersonalservicecompaniesandsonotpaidanydividendtax,becausethey'vetakenmoneyoutasloansinstead,othersmayhaveheardofsomesortofataxschemeorataxplanningopportunitythattheymayhavedecidedtotakepartinandtheymaynothavepaidtaxforthatreason.Somepeoplemayhavejustclaimedexpenses.AnybodythatsaworheardabouttheChristaAckroydcasewouldhavebeenawarefromthatcaseaboutexpensesclaimedinrelationtoSkysubscriptions.Theymayormaynotbeallowableexpensessothesimplestthingforustodoistoignoreexpensesaltogether,becauseit'snotreallypossibletostartassessingeverybody'sindividualexpensesanddecidewhetherornottheyareallowableornotallowable.It'sfairerjusttonottakeaccountofexpensesatall.


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MarkGroom 00:34:56:12Sothosearesomeofthekeyprinciples,let'sstartthereforetobringitalivewithsomenumbers.It'squiteabusyslide,soI'lljusttalkyouthroughitandifyoucanfollowitonyourscreens,that'sgreatbutyoucandownloadtheslideslaterandgothroughtheexamplesyourself,byallmeanssharethesecalculationswithyouraccountantifyou'dliketo.ButthesecalculationsarebasedontheprinciplesIjustexplainedsolet'squicklywhizthrough.Soyoustartwithyourfeesandinthefirstexample,we'rejusttakinggrossfeesof£50,000andthisistheassumptionwhereIR35applies,thetophalfofthecalculation.You'reentitledupuntilthefirstthreeyearstofivepercentstatutoryexpensesdeduction.Soweknockthatoff5%.For2017/18thatdeductionisnotavailable,Idon'tknowifeverybodywasawareofthat,butthatwaswithdrawnfrom17/18underthepublicsectorIR35rules.Thenyouworkoutyouremployer'sNationalInsurancecontributionsandyoudeductthose.Andwhat'sleftiscalledyourdeemedemploymentpayment.It'salmostlikeyoursortofadjustedsalaryasifyouwereemployed.Sotechnicallyit'scalledyourdeemedemploymentpaymentandyouworkoutthetaxandNationalInsurancethat'sdueonyourdeemedemploymentpaymentsolookingatthefigure£42,705,we'vecalculatedwiththePayAsYouEarncodeof1000L,thatgivesyouyourpersonalallowanceinfullthatthePayAsYouEarnduewouldbe£6709.Theemployee'snationalinsurancewouldbe£4086andyournetpaywouldthenbe£31,910.SoyourgrossfeefromBBCof50kandyouendupwith£31,910andyourtotaltaxandnationalinsuranceduewouldbethesumoftheemployer'sNationalInsurance£4795.ThePayAsYouEarnof£6709andtheEmployeesNICsof£4086.Soyou'dhavepaidintotalorHMRCwouldclaimthatyouhavetopayintotal£15,590andwe'veabbreviatedthatfigureA.


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MarkGroom 00:37:23:00Thenwhatwedo,sothat'sthestandardcalculationbasedontheconsistentsetofprinciples,thenwhatwedoissayok,howmuchCorporationtaxandDividendtaxwouldyoupayonthosesameprinciples.Soagain,youstartwiththefeesof£50,000.Weworkoutthecorporationtax,whichisonthiscalculationstraighttwentyonepercentoffifty,so£10,500.Remember,ignoringexpenses.Thenetprofitwillbepaidasadividend£39,500andbecausethatdividendiswithinthebasicratetaxband,thereisnofurtherincometaxtopayonthatdividendsoweshownilthereforincometaxondividend.Andyoureceivenetincome£39,500andthetotalcorporationtaxanddividendtaxdueistenandahalfandwesimplycomparethePayAsYouEarnandNationalInsuranceunderIR35calculation£15590withtheoffset,thecorporationtaxanddividendtaxyouareentitledtooftenandahalf.Thatdifference£5090istheamounttheBBCispreparedtopaytowardsyoursettlement,andifyouhaven'tdoneanythingelsethatwillsettleyourassessmentinfull,there'llbenothingelseforyoutopay.Ifyou'vedonesomethingelseandyouhaven'tpaidtheassumedamountofcorporationtax,sosayyou'vepaidlesscorporationtaxandintheboxtotheright,I'vesortofmadeanote,let'ssayyourPSCsonlypaid£8500inCorporationTaxinsteadof£10,500.ThenthedifferenceHMRCwillrequireforsettlementwillbethe£15,590totalPAYENICdueunderIR35lessthe£8,500andthatwillbe£7090thatHMRCwillbeexpectingatthenextsettlement.TheBBC'scalculationis£5090,soyou'llneedtopaythebalanceof£2000yourself.Soihopethatexplainswhattheproposalis.TheBBCwillalwayspaytheamountcalculatedonthestandardcalculationonthestandardprinciples,the£5090.Butiftherearefluctuationsintheamountoftaxesthatyou'vepaidbecauseofpersonalchoicesinyourpersonaltaxaffairsthenyouwillneedtopayanytaxattributabletothatyourself.Thatkeepsitfairandconsistentforeverybody.


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MarkGroom 00:39:47:05Nextexample,it'sthesameexamplereallyjustwithahigherfiguresowedon'tneedtogothroughitallagain.Thisfigureis£100,000ofproceedsandifyouworkdownthroughthecalculations,youfindthatthetotalIR35taxandNationalInsuranceis£38,881.That'sthefiguremarkedAandthenifyouworkdownthroughthecorporationtaxanddividendtaxcalculations,youfindthetotalC.TandD.Ttaxesare£30,331figureBandyoufindthedifferencewouldbe£8550andthatistheamounttheBBCwillbepreparedtopaytowardssettlingyourIR35affairsandasIsaybefore,providedyou'veactuallypaidthecorporationtaxandthedividendtaxasexpectedbasedontheseprinciplesthenthatassessmentwillbecomefinalandsettledandthere'llbenothingfurthertopay.Ifyoupaidlesstaxandtheexampleherewouldbethatactuallyyouhaven'ttakenallthedividendsintheyearandsoyourdividendtaxpaidwas£5000insteadof£9331sointheboxtotherightthat'stheassumptionjusttoillustratewhathappensifit'sdifferentfromourassumptions.ThenthedifferenceHMRCwillrequireforsettlementwillbethe£38,881thePayAsYouEarnandtheNICsundertheIR35lessthe£21,000andless£5000leaving£12,881payable.TheBBCwillpay£8550andyouneedtopaythebalanceof£4331yourself.Andforthat£4331,willjustrelateentirelytopersonaltaxmattersanditwon'tbeanythingtodowithIR35.TheamountrelatingtoIR35willbethe£8550thattheBBChascalculatedunderthestandardprinciples.Ihopethat'sclearforPSCs.

MarkGroom 00:41:45:04


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MarkGroom 00:41:45:11Nowjustonthethirdexample,wedon'tneedtogothroughthisinmuchdetailbecausethisisanexamplethatappliesifyou'renotinaPSC,ratheryou'vesetyourselfupasapartnershipandsometimespartnershipsarereferredtoasLLPsLimitedLiabilityPartnerships,sometimesthey'rejuststraightpartnerships,sowedon'tneedtogettoohunguponthat,wejustabbreviatethemtoLLPsforshort.TheLLPcalculationisslightlydifferentsothetophalfisexactlythesameasthecalculationthatwejustlookedatforPSCs.ThebottomhalfisdifferentbecauseLLPsdon'tpaydividends.Theydon'tpaycorporationtax.Soinsteadyoucanseefromthebottomhalfa£100,000offees,incometaxispayableifyou'reinanLLP.Andthatwouldbeatthefullratesothat's£29,627,class2andclass4NationalInsuranceispayable,thatwouldbe£4358givingyouanetincomeof£36,388,totalincometaxandNICsof£33,984,andthedifferencebetweenAandBthenis£4897.ThatwouldbetheamounttheBBCwouldpayifyou'reinanLLPorPartnershipearningwithfeesof£100,000.Ihopethoseexamplesareclear,Iappreciatethosearealotoffigures,alotoftaxcalculationsforamorning.Theideathough,givingyouthismuchdetail,thisisreallymeanttobeaninformationpack,ratherthansomehighlevelslidedeckthatyoutakeawaywithyouandstruggletoworkoutwhatitwasweweretalkingaboutatthetime.It'sallthereonaplateforyoutosharewithyouraccountantandbyallmeanscomebacktousaswell.Ifyouhaveanyquestionsaboutanyofthiswe'reheretohelp.Wewillgiveyoudetailsofthehelplinethathasbeensetupforyoulateronthatyoucancomebackandaskanyquestionsyoulikeaswehelpyouthroughthis.So,nextsteps.Enoughofmyvoice.Emilywouldyouliketotalkaboutnextsteps.


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EmilyPlumb 00:43:49:06Yessure,thiswasreallytojustrecaponwhatwecoveredoffintermsofyouroptionsearlieroninthewebinar.Ifyou'restillunsurewhethertoappealyourassessment,we'drecommendspeakingtoyouraccountantortaxadvisertoseewhattheyconsidertobethebestthingforyoutodoandthebestwayforyoutoproceed.Ifyouhavedecidedthatyouwanttosettleyourregulation80oryoursection8.Oryoudecideinthefuturethat'swhatyou'dwanttodo,againwewouldrecommendthatyoutakeadvicebeforedoingso.Justtoensureyoudon'tregretthislateron.SoaswementioneditmaywellbebecausethesettlementsorBBCcentralsettlementdiscussionsarestillongoing,thatyourroleisagreedbyHMRCtobeself-employedatsomepointinthefutureandthereforeyou'llbesettlingunnecessarily,sowe'dalwaysrecommendtakingadvicebeforeyousettle.


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EmilyPlumb 00:44:49:00Andthenifyouwanttoappealandpostponeorjustappealifyoudon'twanttopostponethetaxchargeandthenjustareminderthatthatwillneedtobeinwritingtoHMRCwithin30daysofthedateofissue.Andthatyouneedtomakesurethatyoustateallthegroundsofappealthatapplytoyouwhenyousendinthatappeal.Ifwejustflickontothenextslide,ifyouchoosetoappealyourassessment,you'vegottwochoices.Thefirstoneistodealwiththatappealyourself.Ifyou'regoingtodothat,youwouldappealjustasIhavementionedpreviouslyorontheslideabove.Justmakesure,asMarkmentionedpreviously,theregulation80oryoursection8assessmentwon'thaveanyoffsetsforcorporationtaxordividendtaxorifyou'reinanLLP,othertaxesthatyoumayhavepaidpreviously,sowhenyou'reappealingoryouradviserisappealingonyourbehalf,youjustneedtomakesurethat,aswellasincludingyourgroundsforappealthatyourequestthosetaxoffsetstobedonebyHMRCotherwiseyoucouldendupjustpayingahigheramountoftaxandNICsthanisultimatelydue.Oraspartofyourappeal,you'llstillneedtoappealandsendthatletterintoHMRCbutyoucanuseasoneofyourreasonsforappealthatyouwouldlikeyouraffairstobedealtwithunderthecentralBBCsettlement.Ifyouwantthattohappen,you'dstillneedtosubmityourappealtoHMRCwithinthetimeframerequired.ButtoincludethatyouareawareoftheBBCcentralsettlementandthatyou'dlikeyouraffairstobedealtwithunderthat.OncethecentralsettlementhasbeenagreedandfinalisedwithHMRC,thenwewillbeintouchtoletyouknowfurtherdetailsaroundexactlywhatyou'llneedtodotobepartofthatasMarkmentioned,signingalettertosignupbepartofitandtohaveyourCorporationtaxandDividendtaxoffsetaspartofthatcentralsettlementratherthandealingwiththatyourself.


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MarkGroom 00:47:02:07GoodandourlastslidethenbeforeweopenupforquestionsandthatisoksoI'veheardallaboutthesettlement,wherearewewiththis?What'shappening,therehavebeenpresscomments,misinformedpresscommentsaboutwhatthestatusofthesettlementis,sowewillcorrectthatsortofmisinformation.ThesettlementisverymuchaliveandkickingbutitisverycomplicatedandsoitistakingsometimetoconcludewithHMRC.Alloptionsareopenbutthere'sstillalotoftechnicalpointsthatwedon'tneedtoboreyouwithnow,toagreewithHMRCbutthemostobviousonewouldbewhattheemploymentstatusshouldbeforeachofthe27categoriesthatareincludedwithinthesettlement.Nowmostofthosearealreadyagreedactuallybuttherearestilloneortwothatareunderreviewandaresubjecttofurtherdiscussionsandmayneedtobesub-categorised,splitbetweenroles,partofarolemightbetreatedasemployedandpartmightbetreatedasself-employed.Thatworkisunderway.ThenextsubmissiontoHMRCforapprovalinprinciple,thesettlementisintendedtobemadeinJune.Sothatisthesortoftimeline.Andassumingallgoeswellthenitwouldn'tbeunreasonabletoexpecttohearbackendofJune,earlyJulyandthenitwouldbepossibletomakeafurtherannouncementtopresentersthatthathasbeenagreedinprincipleanditisfullsteamaheadtosettlingeveryone'staxaffairsforthosefouryearsforthosepeoplewhowanttotakepartandfurtherinstructionswillbeissuedbytheBBCatthetime.

MarkGroom 00:48:56:05InthemeantimethoughweappreciatelotsofpeoplegettingtheseReg80s,somepeoplearen'tfamiliarwiththem,concernedwhattodoaboutthem.SoImentionedbeforethere'sahelpline,there'sthiswebinartoday.Pleaseusethehelpline.It'ssetupforyoutoaskuswhateverquestionsyoulikeandwe'vealreadyhadabout40presenterscallthehelplinetodiscusstheirconcernsandIthinksofarthat'sbeenquitehelpfulforthem.


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MarkGroom 00:49:26:06IntermsofwhattheactualamountsarethattheBBCwillpay.Obviously,we'vejustworkedthroughacoupleofexamplesofthe£50kfees,£100kfeeslevelandyou'llbethinkingthatyouwouldliketoknowwhatitmeanstoyouforyourleveloffeesinTaxYear2014/15.Soyoursortofpersonalillustrationwillbeavailable.Youjusthavetorequestit.Anditwillbecalculatedonthestandardprinciplesdon'tforget.Butwewon'thaveaccesstothedetailedinformationastowhattaxesyou'veactuallypaid.That'sprivatetoyou.Wehavenowayofknowingthat.Onlyyouknowthat.Soallwecandoissharewithyouthetheoreticalcalculationandyouhavetoworkoutwhetherornotthere'sataxgapthatyouneedtopaypersonally,becauseofthechoicesyou'vemadeforexampleaboutthepaymentofdividendsortheclaimingofexpensesorthepaymentofspouses.Ok,sothatisallnothingtodowithIR35.Thoseareallpersonalchoices.

MarkGroom 00:50:39:10Finally,it'syourindividualdecisionthatwerespectyouhavetherighttotakepartintheBBCSettlementornot.EntirelyuptoyouifyouwishtopursueyourassessmentseparatelyandprivatelywithHMRC,it'sentirelyuptoyoutodoso.Butyoujustsimplywillbeaskedifyouwanttotakepartinthecentralsettlement,you'llsimplybeaskedtosignapieceofpapertoauthorisetheBBCandauthoriseHMRCactuallytocalculatethevariousoffsetsavailableandprocessthoseforyou.

MarkGroom 00:51:14:12Sonextupdate,endofJune,earlyJulyandatthispointIthinkwecanstoptheslidepresentationandopenthefloorforquestions.

JennyMcHale 00:51:25:02We'vegotaquestionfromClaudia,andshe'saskingaboutwhenyouprovidedthesixoptions,ifforthegroundsofappeal,iftheyappealedonthebasisthattheywantedtoenterintotheBBCsettlement,isthereariskthatthatcouldsuggestthatyouagreethatyou'renotself-employed?


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MarkGroom 00:51:56:07TakingpartintheBBCsettlement,issomethingthatshouldbeincludedalongwiththegroundsofappeal.Soit'snotreallyagroundinitself.Soyouneedtoappealonthebasisthatyouthinktheassessmentiswrong,butinadditiontothat,youcanindicatethatyouwantyourappealtobedealtwithseparatelythroughtheBBCsettlement.So,youwouldn'tjustputyourgroundsofappealasbeingyouwanttobepartoftheBBCsettlement,thatwouldn'tbeyouronlygrounds,itneedstobeaccompaniedbysomethingelse.Suchas,youdon'tbelievethatIR35applies.ButifyouwanttotakepartintheBBCsettlement,thatdoesn'timplyanythingaboutwhetheryou'reemployedorself-employed.Don'tforgettherolesthatwe'veseparatedtwentysevenrolesworkingwithJennyandBBCtaxteamandmostofthose,we'veputforwardasbeingselfemployed.Therearesomeinevitablythatarecomingoutasemployedbutyourrolewouldjustbetreatedinthesamewayaseverybodyinthatrole.Itwilleitherbeaself-employedroleoremployedrole.That'showthecentralsettlementwouldwork.NowifyouwanttogooutonalimbandifyouthinkwellIdisagreewiththeBBC'sassessmentandIwanttofightmyowncase,thenyouwouldn'ttakepartinthecentralBBCsettlement,youwouldthentryanddealwithyourownassessmentyourselfbutthatwouldultimatelymeanalotofnegotiationsthatyouhavetohavewithHMRCandpotentiallyendingupgoingtotribunaltohavethat,ifyoucan'tresolvethroughnegotiationyouhavetohavethatresolvedthroughTribunalassomepresentersaredoingrightnowandwe'reseeingtheresultsofsomeofthosetribunalcasescomingthroughnowI'msureyou'reallawareofthat.Butthatistheprocessthatyouwouldhavetogothroughifyoudon'twanttotakepartintheBBCSettlement.

JennyMcHale 00:53:43:09Andthenwe'vehadaquestionfromSamiraaskingwhentheygetpaidtheamountwhentheagencydeductstheirfeeshowwouldthatbetakenintoaccountwiththeproposedsettlement?


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MarkGroom 00:53:56:04Sowhentheagentdeductsfeessothatwouldbeanexample,wherewementionedbeforeabouttreatingeverybodyonthesametermsandsomepresentersdon'tpayagentfeesandsomedosoitwouldn'tbefairtotreatoneperson'staxcalculationadjustedforagenciesandanotherperson'staxcalculationnotadjustedforthosefeessoratherthantryandworkoutaseparatepersonalcalculationforeverybodylikethat,whichwouldbenighimpossible,simplybecausetheinformationisprivatetoeverybodyandtheywouldhavetosharethatdatawithus.Soratherthandothat,whatwe'resayingisthecalculationonthetophalf,thePayAsYouEarncalculationdoesn'thaveanyexpensesdeductedfromitandthebottomhalf,thecorporationtaxcalculationdoesn'teither.So,sortoftopandbottomiscomparinglikewithlike.

JennyMcHale 00:54:54:10We'vehadaquestionaboutpresumablythatthissamescenariocouldkeephappeninguntilthepointwhentheBBCdecidedtotaxonaPAYEbasis.

MarkGroom 00:55:05:03Sothat'salreadyhappened.In2017/18thenewruleswereintroducedthattheBBChastodothatwherewhereveranindividualwhoisconsideredtobeemployedandtheBBChasnochoiceinthatmatter.It'sstillpossibleforpeoplewhodisagreewiththatassessmenttofileareturnonthebasisthattheythinkthey'reself-employed.Ifyoudothatthough,youwillthentriggertheinquiry,HMRCwillmakeaninquiry.Youwillenterintonegotiationsifyoucan'tsettleyourinquirythroughnegotiationyouwillfindyourwaytoTribunalandwillhavetobesettledthroughTribunal.Butwe'realreadyinthatpositionandfrom2020everyonewillbeinthatposition.Deloittewillbeinthatposition,allothermediacompanieswillbeinthatposition,alltheprivatesectorfromApril2020willallbehavingtooperatePayAsYouEarnonpaymentstoPSCswhenevertheyassesstheindividualtobelikeanemployee.

JennyMcHale 00:56:03:08Sowehadafewpeopleaskaboutthecostinvolvedwithdealingwiththis,willBBCpayanyaccountantfees?


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JennyHenderson 00:56:14:03Okay,sothankyouJenny.SothecurrentpolicyfortheBBCisthatwearenotpayinganyaccountancyfeestodowiththeseinquiries.Iknowsomepeoplearealreadyunderinvestigationsotheirinquiriesmayhavebeenongoingforalittlewhileandthesenewones.Ifweshouldchangeourpolicyonthat,thenwewillletpeopleknowbutthecurrentpolicyisnottomakeanycontributionstowardsthat.

JennyMcHale 00:56:49:03We'vehadaquestionaboutaPSCthatiscurrentlyinliquidation,oncetheReg80isreceivedwoulditstillapplytothecompanyonceit'sliquidated?

MarkGroom 00:57:03:07

MarkGroom 00:57:04:03Sostrictlyspeaking,no,becauseitdoesn'texistbuttherevenuehaveaprocessforreinstatingliquidatedcompaniesisverydifficult.It'snotsomethingtheydolightly.AndIthinkJennyisrightthattheymayhaveevendecidedthatforthepurposeofthesereg80sthattheywouldn'tdothat.Howevertheyarelookingintoittoseeifthereareanycasesthatarebigenoughormateriallyenoughtowarrantthemreinstatingthecompanies,thentheywouldraiseReg80sandfollowthemupinrelationtothosereinstatedcompanies,butit'snotsomethingthattheywouldjustdowillynilly.It'squitedifficulttodo.

JennyHenderson 00:57:57:12Theyhavetogotocountycourttogetthecourttoagreetothecompanybeingreinstated.

MarkGroom 00:58:00:00Oneofthereasonswhyit'ssodifficult,iswhencompaniesareliquidatednormallytheycan'tbeliquidateduntiltherevenueisnotifiedandtheyhaveanopportunitytoobjectatthattime.Sothecountycourtwouldsaywellhangonaminute,you'vealreadyhadanopportunitytoobjecttotheliquidation.Whyhaveyouchangedyourmind?Youknowthatallneedstobefactoredinandtakenintoaccount.Thecountycourtmightsayno,thecountycourtmightsayyesbutyou'vegottoputagoodcaseforward.


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JennyMcHale 00:58:33:07I'vehadaquestionfromsomeonesayingthattheydon'tknowwhatthe27categoriesofrolesareandhowdotheyfindoutthisinformationandmoreimportantlywhatthattheircategoryis?

MarkGroom 00:58:45:09Itmightbetooearlytosharethatbecausewe'restillnegotiatingwithHMRC.There'sarangeofrolesforexample,sportspresentersmightbearole,anewspresentermightberole.TheremightbeTVroles,theremightberadioroles.It'sbasicallylookingacrossallgenresandtryingtocompartmentaliserolesthatlookverybroadlysimilarwithoutgoingintothedetailofpersonaltermsandandpersonalfactsandcircumstances.JustlookingatgenericrolesandasIsay,it'ssolelyforthepurposeofthesettlement.It'snotforanyotherpurpose.Wecallthathonourwithoutprejudicebasissothatdeterminationcan'tbeusedforanyothertaxyearanditcan'tbeusedforanyotherpurposeorapplytoanyother,ifyouworkforotherpeople.Maybeyoudo.Maybeyou'vegotothersourcesofincome.Thatdeterminationcan'tbeappliedtothoseotherengagementsthatyouhavewithothers.It'sstrictlyforfouryearsforBBCincomeonly.

JennyMcHale 00:59:50:09Ihadaquestionasking,what'stostopHMRCfromgoingbackbeyond2014/15.They'vereadthattheycangobacksixandeventwentyyears.


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MarkGroom 00:59:58:13Yes,thatiscorrect,butifHMRCwantstogobacksixyears,ithastoshowthatthePSChasbeencarelessandthatisentirelypossiblethePSChasbeencareless.TheBBCsettlement,oneoftheproposalswithintheBBCsettlementisthatitwouldbeafouryearsettlementanditwillbeacceptedthatdeterminingemploymentstatusisverydifficultandsubjective.It'snotacaseofbeingcareless.Itisjustacaseofbeingdifficultanditispossiblethatpeoplegetthewronganswerwithoutbeingcarelessandsothere'snobasisforgoingbacksixyearsandtherecommendationthatwe'regoingtomaketoHMRCthatitshouldbeafouryearsettlement.Now,thatisonlythroughtheBBCsettlement.SoanybodywantingtodealwiththeirownassessmentpersonallywillhavetoprovethatthemselvesandifHMRCwanttocontendthatanyparticularPSChasbeencarelessthenyoumayfindthattheywanttogobacksixyears,ratherthanfour.Twentyyears,bythewayJenny,justbecauseyoudidmentiontwentysothatwasanincompleteanswer.Twentyyearsistheabsolutemaximumbutthatisnormallyreservedwherepeoplehavebeenfraudulentandthereasonfornotmentioningit,Iwouldassumewithinthispopulation,thereisnobodythathasbeenfraudulent.

JennyMcHale 01:01:37:00Thankyou.IhadaquestionaskinguntilthesettlementwiththeBBCisfinalised,presumingtheironlyoptionistocontinuetodealwithitasindividualsandpayingtheiraccountantstodothat,isthatcorrect?


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JennyHenderson 01:05:24:07Sorry,slightlyconfusing.TherearetwoJennysonthiscall.Sothere'smyselfandJennywhoishandlingthecall.Sowearelookingataprocesswherebypeoplecantalktousaboutthesenewprotectiveassessments.Soforpeoplethatweknewwereunderinvestigationforaperiodoftime,wehavewrittentothemindividuallyandaskedthemtocomeandtalktousaboutasettlement,alongthelinesoftheglobalsettlementwearetryingtoreachwithHMRC.We'venowrealised,obviously,thatwithpeoplereceivingprotectiveassessment,it'simportantthatweengagemoredirectlywiththem.TherouteforpeoplereceivingprotectiveassessmentsisfirstofallgetintouchwiththeDeloittehelplineandspeaktopeoplelikeMarkandEmilyandtherestoftheteamtoreallyunderstandwhatyouroptionsareandwhatyoureallyneedtodo.Secondly,wereallydoadvisepeoplespeaktotheiraccountantsbecauseIknowit'sanadditionalcostbuttheydohavemuchmoredetailedinformationaboutyourtaxaffairsandyourothersourcesofincomesoit'sreallyquiteimportantthatyouspeaktothem.Thirdly,wewouldbesuggestingthatyoucontactthetaxteamviatheBBCContributorsandArtistsInbox,I'veprobablygotthatwrongbutwe'llgiveyoutheproperemailaddressattheend.Butifyoucontactusthroughthathelpline,thenwewillsetupaconversationwithsomeonefromtheTaxteamtotalkaboutnextstepsonyoursettlement.Itmaybethatduringthecourseofthisprocess,you'resweptupintheBBCglobalsettlementwhichisfine.Ifyou'renotsweptupinthatthenwecantalktoyouabouthowyoudealwithit.Wearesettingupaprocessandwewillbecomingbacktotalktoyouaboutthatshortly.Ihavebeentoldit'stheBBCPresentersandcontributors@BBC.co.ukemailaddressbutwewillcirculatethatafterwardswiththiswebinar.

JennyMcHale 01:05:24:09Thisnextquestion,itmightactuallyrequirecontactingtheemailaddressforacallbackformorespecificinformationbutthey'vementionedthatthey'vejustfinishedmakingclawbackpaymentstoHMRCoverIR35.Theycan'trecallexactlywhatit'sforbutcanthatbeusedtodelaymakingfinalpayments?

JennyHenderson 01:05:25:04

JennyHenderson 01:05:27:11Ithinkweneedabitmoreinformation


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JennyMcHale 01:05:28:04Ifyoucouldjustcontacttheemailaddressthat'sonthescreenandrequestacallwithDeloitte,wecangiveyoumoreinformationonthat.

JennyMcHale 01:05:29:04Howdowegetpersonalillustrations?

JennyHenderson 01:05:29:07WewillberunningthosefromtheTaxteamsoifyouhavespokentoyouraccountantthenifyouemailtheemailaddressImanagedtogiveyoujustnowthenwecanstartpreparingthoseforyou.

JennyMcHale 01:05:29:08Onefinalquestion.They'vegototherstreamsofself-employedincomethattheydeclareandprove.Isthisproofofself-employment?

MarkGroom 01:05:30:07Noit'snotproofbutitisrelevant.It'srelevantbecauseifyouhavelotsofdifferentsourcesofincomeandtheBBCissortofoneofyourclientsasitwereandyoudolotsofworkforsay,youmightbeajournalist,youmightdoabitofworkforITV,youmightdoabitofradio,youmightdoabitofTVsoyoucouldhavelotsofdifferenttypesofengagement.Ifyoulookatallthecaselawinrelationtothispoint,somebodythat'sgotlotsofclientswouldbenormallybeconsideredtobeinbusinessontheirownaccountandtheywouldnormallybeconsideredtobeselfemployedbutitdoesdependontheproportions.So,forexample,intherecentcasesthatwe'veseenthatwasafactorthatwastakenintoaccountandLorraineKellythejudgedecidedthatbecausesheonlyhad33%ofincomefromITVthatwasoneofthefactorsthatledtoherbeingconsideredtobeself-employed.Itwasn'tthefactorbutitwastakenintoconsideration.Andthatpercentagevaried,itwas66%atonepointbutatanotherpointitwas33%.Butontheotherhand,ifyoulookatChristaAckroyd'sjudgementfromhercaseshewasworking,accordingtothejudge,225daysfortheBBC,soahugepercentageofherincomewasderivedfromtheBBC.SothatkindofrelationshiphasadifferentfeeltoitfromonewheretheBBCisjustoneofmanyclientsthatyouhavesoitisrelevantbutit'snotthedecidingfactor.


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JennyMcHale 01:07:05:13Sowejusthaveonemorequestionwhichwecanfinishwiththat'scomein.IfthesettlementwithHMRCbreaksdownwouldtheBBCstillmaketheaforementionedcontributions?

JennyHenderson 01:07:17:01Yes,soIcanconfirmthatifwedon'tprogresswiththesettlement,wewillsettlethepeople'spaymentsinthewaythatMark'sdescribedonthiscallandthat'swhatwe'redoingtohelppeoplethatarecurrentlyunderinvestigationaswell.Idon'tthinkwehaveanymorequestions.

JennyHenderson 01:07:44:07I'djustliketothankeverybodyforjoiningustoday,sendinginquestionsandparticipating.AndI'dalsoliketothankMarkandEmilyforcomingoverandpresentingtous.Ithinkit'sbeenreallyuseful.TheslidedeckisalsoreallyusefulsoIwouldrecommendthatpeopleaccessitwhenwesendthelinksthrough.Ithinkwe'regoingtosenditthroughtomorrow.AndasIsay,ifyouhavereceivedoneoftheseprotectiveassessments,it'sreallyworthsharingthatwithyouraccountantandadviser.So,thankyouverymuch.

name: ir35 webinar 16 04 2019.mp4 jenny henderson … · 2019-04-30 · clip: ir35 webinar 16 04...

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