The Latest IR35 News: Gary Lineker

As one of the most famous faces in football, Gary Lineker is no stranger to scoring a goal or two – and it looks like he might score against HMRC too.

Gary Lineker has contested his £4.9m tax bill, and his lawyers have blasted HMRC, telling a legal hearing that a tax inquiry into the footballer’s finances has been “looking in the wrong place”. HMRC wants the IR35 legislation to apply to the presenter’s contracts.

The Match Of The Day host was told by HMRC that he should have been classed as an employee of the BBC and BT Sport for his presenting duties. However, Gary Lineker and his representatives defend that he was a freelancer with a contract in place for the role.

The multi-million-pound IR35 bill is the largest to have been issued so far to a contractor.

Lineker says all taxes were paid on the income via a partnership set up in 2012 with his ex-wife, Danielle Bux, and is appealing against the demand.

HMRC claims that Lineker was “incorrectly operating outside the IR35 legislation” when appearing on the BBC and BT Sport between 2013 and 2018.

Lineker’s representative stated that all taxes had been correctly paid and that his client “had been dragged through the papers” by being accused of not paying his income tax.

What are HMRC accusing Gary Lineker of?

HMRC are trying to apply the legislation, that we all know as IR35, to the Match of the Day host’s contracts. IR35 is designed to clampdown on tax avoidance by “disguised employees”, charging for their services through a limited company.

Gary Lineker’s representatives have made it very clear that they are of the opinion that HMRC had “closed their minds to anything on the contrary” and were keen to apply IR35, however “IR35 is not a factor”.

If it is decided in court that the former England striker was engaged personally and did not operate through his company, then the BBC and BT Sport would be liable for missing employment taxes.

Just one of many…

Gary Lineker is just one of the many famous faces that have been targeted by HMRC over the last few years due to IR35 investigations.

In February last year, Adrian Chiles successfully contested a £1.7M IR35 bill. In 2019, Lorraine Kelly also successfully appealed her £1.2M IR35 bill at a tribunal. Kaye Adams also won her case, and most recently Stuart Barnes was the first Sky TV case upheld by FTT.

Eamonn Holmes, however, is still challenging his first-tier tribunal verdict. His £250,000 liability IR35 case found him to be a disguised employee of ITV last year.

With the judge having now heard both arguments from Gary Lineker and HMRC, a decision is expected in the next few months.

IR35 ahead of Spring Budget

As we eagerly await the Spring Budget on 15th March, the ‘IR35 offset issue’ has been catapulted to the top of the list of things people in the industry want addressing. Experts are calling for a fix for the issue, which results in HMRC’s off-payroll rules taxing the same income twice.

At the end of 2022, HMRC responded to criticisms by teasing a potential “legislative solution”. HMRC also said that it had started a “process” to “reduce the circumstances” where it collects taxes twice.

However on a less positive note, the IR35 reform being U-turned at Spring Budget 2023 does not look likely, which has attracted a whole host of backlash online across social media. Some even claim that there has been nothing as destructive in their contracting career as IR35 changes.

Others believe that reinstating IR35 reform without any changes has caused “unprecedented, historical damage”.

What is likely to be in Chancellor Jeremy Hunt’s financial statement?

As recent budget announcements show, we can never be certain what may or may not be announced in the Spring Budget. This will be the Chancellor’s second budget statement since taking the job, and will take place on 15th March 2023, usually around 12.30pm from the House of Commons.

The budget tends to lay out plans for raising and lowering taxes, as well as the government’s plans for public spending, including schools, health and defence.

Energy prices are likely to be high on the agenda, and support for energy bills is expected to continue for another three months from April. Fuel prices are also set to be discussed.

Labour leader Sir Keir Starmer will give his response as soon as the speech is over, and then the Office for Budget Responsibility (OBR) will publish a report outlining how the economy is doing.

Navigating the twists and turns

At Gorilla Accounting, we know how difficult it is to keep up with the changes that seem to be made more regularly than ever, especially if you’re a contractor.

We work with you to determine your IR35 status and ensure that all your tax payments are made in a way that maximises your earnings whilst still being IR35 compliant, so you have peace of mind that no HMRC investigations are coming your way.

If you’re looking to work with a new accountant and want to know more, you can contact us today by filling in our online form, here, or calling us on 0330 107 9670 to speak to us about your options.