Tuesday, 6 October 2009

BBC Presenter Tax Avoidance

From the Telegraph:-

They are saving thousands of pounds by using the avoidance tactic – at the expense of the rest of the public.

Insiders say the BBC has advised them to set up 'service companies' so that they can convince the tax man they are legitimately working as freelancers.

Those that have done so include Fiona Bruce, the 10 O'Clock News presenter who also fronts Antiques Roadshow; Emily Maitlis and Jeremy Paxman from Newsnight.

Bruce has set up a company called Paradox Productions; Maitlis has Mouse Inc. and Paxman Out in the Dark.

There's a regulation known as IR35 which was designed to stop this sort of thing going on, what was known as "Friday to Monday" where you leave your desk on Friday as an employee and return on Monday as a freelancer which was only done to avoid tax.

Two of the tests are the time you've been with a client and the number of clients that you service. Paxman and Bruce are really going to struggle to get past that if the HMRC investigate.

A BBC spokesman said: "We are not going to discuss individuals tax arrangements. Clearly how people organise their tax status is something that they would need to take their own personal advice on.

"Some individuals working as freelancers in broadcasting, and a range of other sectors, like IT, set up service companies which deal with their tax arrangements and this is perfectly lawful."

The difference is that most freelance IT people don't spend 2 decades working at the same place, and mid way through set up a limited company (Companies House has all the details on these companies) to work as the contractual arrangement. Or, not if they don't want a visit from the taxman.

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