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The latest decision in the long-running IR35 dispute involving Kaye Adams has received considerable attention. We have commissioned an article on the technical aspects of the decision, so I will not dwell on those here. But I will comment on some of the wider issues.
This is the fourth hearing of the appeal – it started in the First-tier Tribunal (FTT), went to the Upper Tribunal (UT) and then to the Court of Appeal, which sent it back to the UT. The UT then sent the case back to the FTT. Anybody who has read the latest decision in full (tinyurl.com/fttathollhousenov) will know that the result has been a procedural tangle which at times is almost impossible to follow. Large parts of the decision are taken up with the FTT trying to establish what the Court of Appeal actually asked it to do.
Stuck in the middle is the taxpayer who is quoted as saying ‘there is no jubilation for me at this result – the mental stress has been close to unbearable at times’. Has something gone wrong here? Certainly, some commentators have thought so, with one calling for the introduction of a taxpayers’ bill of rights. Others are saying that HMRC was wrong to take the case at all. I can’t agree with this. The tribunal itself described this as a very difficult case which was finely balanced and said that it had reached its conclusion with some diffidence. The courts are there to resolve disputes between taxpayers and HMRC and this is surely just such a case.
The problems, as I see it, are twofold. First, the way that costs are treated in these protracted disputes where things bounce back and forward between courts needs to be looked at. But more importantly it shows again how difficult IR35 is to manage in practice. We really do need a fresh approach.
If you do one thing…
Enjoy the festive break and try to banish thoughts of unfiled SA returns.
