Legislation had been enacted to tax under Schedule E, people employed through one man service companies and similar. Representatives of such taxpayers sought review of the legislation as incompatible with European law being a hindrance to the freedom of movement of workers and also state aid. The law set to catch those who would be employees rather than self-employed but for the use of the limited company.
Held: To constitute state aid, their must a an advantage created to an identifiable class of undertakings. A provision which appears discriminatory may not be so if it puts two groups on a more equal basis. There was no state aid. IR35 does not provide a particularly burdensome restriction on those wishing to work within the UK, save where the true character of the relationship was one of employment. Genuine self-employed activities will not be affected and a business of providing employee-like services will be taxed as if there was a real employment situation.
Judges:
Lord Justice Auld, Lord Justice Robert Walker, And, Lord Justice Dyson
Citations:
Times 14-Jan-2002, [2001] EWCA Civ 1945, [2002] STC 165
Links:
Statutes:
Finance Act 2000 60, Welfare Reform and Pensions Act 1999 75 76, Social Security Contributions (Intermediaries) Regulations 2000 (2000 No 272)
Jurisdiction:
England and Wales
Citing:
Cited – Market Investigations v Minister of Social Security 1969
One way of deciding whether a person is self employed is to ask whether he can be said to be running a business of his own. Different tests may have to be combined to produce an overall answer.
Cooke J said: ‘The fundamental test to be applied . .
Cited – Hall (Inspector of Taxes) v Lorimer CA 5-Nov-1993
A freelance vision mixer remained self-employed despite having had a series of short term contracts. . .
Appeal from – Regina and Commissioners of Inland Revenue ex parte Professional Contractors Group Ltd; Ruud Van Zundert and Square Mile Projects Ltd Admn 2-Apr-2001
Legislation was introduced changing the taxation of one man companies through which many professional contractors worked. The asserted that this infringed their human rights by depriving them of property rights in the companies, and was an . .
Cited by:
Cited – Synaptek Ltd v Young (Inspector of Taxes) ChD 28-Mar-2003
The taxpayer was a computer consultant working through the medium of a limited liability company. The respondent sought to make him liable for social security contributions as an employee of the business which used his services.
Held: The . .
Appealed to – Regina and Commissioners of Inland Revenue ex parte Professional Contractors Group Ltd; Ruud Van Zundert and Square Mile Projects Ltd Admn 2-Apr-2001
Legislation was introduced changing the taxation of one man companies through which many professional contractors worked. The asserted that this infringed their human rights by depriving them of property rights in the companies, and was an . .
Cited – Usetech Ltd v HM Inspector of Taxes ChD 8-Oct-2004
The taxpayer operated through a one man limited company employed by a recruitment agency to provide IT services to a customer. He appealed a finding that he was liable to pay tax as an employee.
Held: The appeal was dismissed. The legislative . .
Cited – Emerging Markets Partnership (Europe) Ltd v Bachnak CA 19-Dec-2003
The claimant asserted unfair dismissal. The company denied that he was an employee. The company now appealed against the decision of the EAT to grant the claimant’s appeal. The claimant had been an employee, but the arrangement had been varied so . .
Cited – Bachnak v Emerging Markets Partnership (Europe) Ltd EAT 27-Jan-2006
EAT The claimant had worked as an adviser for the respondent identifying investment opportunities. He said he had been unfairly dismissed after disclosing that the company had overpaid for an investment. He now . .
Lists of cited by and citing cases may be incomplete.
Income Tax, Employment, Company
Updated: 05 June 2022; Ref: scu.167210
