The National Audit Office (NAO) has warned that over 800 BBC presenters could be investigated for alleged tax avoidance, having used personal service companies (PSCs) to minimise their tax bills.
HM Revenue & Customs currently has 100 open investigations into BBC-related PSCs. These relate to tax years prior to April 2017 when the reforms to the public sector regime were implemented, and most of them were opened before that date.
IR35 legislation was introduced by the government to counter concerns that some people were using PSCs to avoid paying the correct amount of tax.
In 2017, the government transferred responsibility for determining employment status for tax purposes of people hired through PSCs to the public bodies hiring them.
A BBC spokesman says: “As the NAO recognises, personal service companies are a legitimate way of contracting for services used by many across the media industry.
“However, determining whether an individual is employed for tax purposes is complex and in managing this we have always sought to balance the interests of our workforce and the licence fee payer.
“We recognise there are still issues to address and remain committed to resolving them. We are currently in discussions with our presenters and are actively engaged with HMRC to explore the options for resolution.”
Whilst HMRC is cracking down on more aggressive tax planning strategies, there are many forms of perfectly legitimate tax planning opportunities available to both individuals and businesses.
As Britons are set to once again hand over billions in unnecessary tax payments this year, we highly recommend you consult a tax specialist who will review your individual situation and advise you of the options available to you.
At Beavis Morgan, we work across a broad range of sectors, advising entrepreneurial people with business ideas and an appetite for financial growth. Our tax specialists, some of whom are former HMRC Inspector of Taxes, are well versed in dealing with all types of tax issues.
Whether you are looking to save on income tax, capital gains tax, inheritance tax, or all three, there are various legitimate tax planning opportunities available to you.
To find out more, please contact your usual Beavis Morgan Partner.