Neil McCann, a former footballer, coach and TV pundit, has had his IR35 appeal dismissed by the UK First Tier Tribunal. McCann and the limited company he works through, McCann Media Ltd (MML), were appealing to HMRC over work that Mr McCann provided for British Sky Broadcasting during the tax years 2013-14 to 2017-18.
The First-Tier Tribunal rejected Mr McCann’s appeal, using the “Ready-Mixed Concrete” three stage test, which is used to determine whether personal service was present, as well as sufficient mutuality of both obligation and control. The tribunal determined that the hypothetical contract between Sky and MML met the conditions for a contract of employment.
HMRC considered that IR35 legislation applied to the arrangements between British Sky Broadcasting and MML, as well as Social Security Contributions (Intermediaries) Regulations 2000 (SI 2000/727), and issued determinations and notices to the limited company regarding PAYE and National Insurance Contributions (NICs) for the tax years in question.
In response to MML’s appeals against this, the First Tier Tribunal determined that the regulations and legislation did apply to the working relationship. As a result, the services McCann provided to Sky through MML were such that, were a contract in place between the two parties, McCann would be determined to be an employee of Sky. MML’s appeals were, therefore, dismissed.
Commenting on the decision, IR35 Shield CEO Dave Chaplin said: “Lack of strong mutuality of obligation and insufficiency of employment-like control was a central part of Mr McCann’s case, and those factors were critical to the tribunal’s decision. Understanding how the talent pool worked and how the workers were in control of their diaries were solid arguments that the engagement was not one of ‘deemed employment’.”
“Had Mr McCann’s contracts been more carefully drafted to align with the relationship he believed he entered into with Sky, the decision may have been different.”
