We’ve a most dangerous suggestion from an MP here today, that the BBC should be responsible for those corporate tax bills its presenters haven’t been paying. No, no way, we don’t change he law because the rampaging mob is waving pitchforks:
The BBC should be liable for the tax bills of presenters encouraged to funnel their salaries via personal service companies, a Tory MP has suggested.
Damian Collins, chairman of the digital, culture, media and sport select committee, said it would be “a real scandal” if the BBC was proved to have forced presenters to be paid as freelancers.
That’s to not grasp the issue in the first place, they weren’t forced to be paid as freelancers. Rather, they were advised to set up personal service companies, that’s not the same thing at all.
If they had been forced to set up as self employed then it would be, as the law stands, entirely fair to pursue the BBC for unpaid taxes- some of them at least. And the arrangement did lead to tax not being paid, as we’ve remarked elsewhere:
It’s also not employees’ NI. These schemes work best for those with significant incomes and the employees’ rate drops to only 2 per cent on earnings over about £42,000: not a figure that generates corporate structures to avoid it. However, employers’ NI is charged at 13.8 per cent on all wages. That is a significant sum when an individual’s income is £160,000 a year and more.
…
Some 100 or so of the BBC’s highly paid presenters and talent are said to have used such a scheme, on the grounds that the BBC encouraged them to do so. It’s employers’ NI which goes unpaid here, so who is the tax dodger? Possibly the employer, the BBC itself?
However, the law is entirely clear here. Once that corporate structure has been set up and used it’s that corporate structure, not the people paying into it, who are responsible for any tax unpaid. Which is as it should be of course. If Megacorp PLC pays LittleTrader Ltd are we going to make Megacorp responsible for the tax bills of LittleTrader? No, we’re not and we cannot.
We therefore cannot do this about the BBC whatever the outrage among the vox populi about the arrangements that organisation made. Because the law is the law and it applies to all equally. Otherwise it’s not the rule of law, is it?
Not responsible for the tax bills, but may find itself on the hook for dodgy advice.
Wonko,
Much as I dislike the BBC I hope not. Its time caveat emptor was once again understood, and accepted, by the general population as it seemed to be in my youth, as a first step to people taking personal responsibility for their lives rather than relying on suing others when they don’t like the outcome of their personal decisions.
BIND… Correctamudo. So-called financial advice from my accountants cost me a significant amount of beer money. But then so did a Racing Post tipster. At the end of the day we are all fully functioning adults.
Just another example of how the UK is institutionally biased against the ordinary man. If I or any other small business person employed a contractor, and they were declared to be an employee by HMRC I would be liable for all their back tax and NI that I should have been paying on their behalf. The BBC does EXACTLY the same thing, yet gets off scot free because it does it via the legal fiction of a company. “If Megacorp PLC pays LittleTrader Ltd are we going to make Megacorp responsible for the tax bills of LittleTrader? No, we’re not… Read more »
+1
Construction companies/sector has to jump through multiple legal/tax hoops to sub-contract to an SE Contractor.
If they don’t, they – construction company – is liable for the unpaid tax. Intention is to dissuade company from “encouraging” employees to be artificially self-employed.
BBC supports this policy for others, but not themselves.
imho BBC should be hit with fine and payment of evaded employer NI. Then BBC should ask hidden employee to reimburse.
@Tim, you should learn more tax law.
“@Tim, you should learn more tax law.”
Tim’s knowledge of tax law here is just fine?
“Should do this, should do that”.
Not my flavour, but OK sure, and in which case campaign for change? There is a good chap over in an Ely end of terrace who will support you on this one 100%.
Purposes! When will this site get an edit function????