THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS v S & L Barnes Limited [2024] UKUT 00262 (TCC)

JurisdictionUK Non-devolved
JudgeJUDGE THOMAS SCOTT,JUDGE MARK BALDWIN on
CourtUpper Tribunal (Tax and Chancery Chamber)
Published date29 August 2024
Neutral Citation: [2024] UKUT 00262 (TCC) Case Number: UT/2023/000068
UPPER TRIBUNAL
(Tax and Chancery Chamber) The Royal Courts of Justice,
Rolls Building, London
INCOME TAX AND NATIONAL INSURANCE intermediaries legislation IR35 personal
service company finding by the FTT that a contractual right of first call would be varied in
the hypothetical contract application of and approach to the third stage of the RMC test of
employment appeal allowed
Heard on: 24 and 25 April 2024
With further written submissions on
10 and 22 May 2024
Judgment date: 28 August 2024
Before
JUDGE THOMAS SCOTT
JUDGE MARK BALDWIN
Between
THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS
Appellants
and
S & L BARNES LIMITED Respondent
Representation:
For the Appellants: Christopher Stone KC and Bayo Randle, instructed by the General
Counsel and Solicitor to His Majesty’s Revenue and Customs
For the Respondent: Michael Collins, instructed by Markel Tax
1
DECISION
INTRODUCTION
1. Mr Stuart Barnes was a well-known rugby union player in the 1980s and 1990s. Around
the time of his retirement from the sport in 1994, Mr Barnes began his career as a freelance
writer and television presenter. He came to be known as “the voice of rugby”.
2. Through his personal service company, S&L Barnes limited (“SLB”), Mr Barnes
provided services in relation to rugby union to a number of media organisations. In the period
between 6 April 2013 and 5 April 2019, SLB provided the services of Mr Barnes to Sky TV
Limited
1
(“Sky”) pursuant to two contracts. HMRC considered that the contracts fell within
the intermediaries legislation (commonly known as IR35), with the result that Mr Barnes
was taxable on his income from Sky as if an employee, and issued SLB with determinations in
respect of income tax deductible through Pay As You Earn and notices of decision in respect
of national insurance contributions (“NICs”) for the tax years within that period.
3. SLB appealed against the determinations and decisions to the First-tier Tribunal (Tax
Chamber) (the “FTT”). In a decision released on 20 January 2023 (the “Decision”), the FTT
allowed SLB’s appeal. HMRC now appeal against the Decision.
THE LEGISLATION AND THE ISSUE BEFORE THE FTT
4. The purpose of the intermediaries legislation was described by Robert Walker LJ (as he
then was) in R (Professional Contractors Group & Others) v IRC [2001] EWCA Civ 1945 at
[51], as being:
to ensure that individuals who ought to pay tax and NICs as employees
cannot, by the assumption of a corporate structure, reduce and defer the
liabilities imposed on employees by the United Kingdom's system of personal
taxation.
5. The question whether the intermediaries legislation applies to any particular set of
circumstances is determined by reference to sections 48 to 61 of the Income Tax (Earnings and
Pensions) Act 2003 (“ITEPA 2003”). The equivalent provision for NICs purposes is Regulation
6 of the Social Security Contributions (Intermediaries) Regulations 2000. The parties agree
that in the circumstances of this appeal there is no material difference in the effect of the two
sets of provisions. Therefore, as did the FTT, we focus in this decision on the provisions in
ITEPA 2003.
6. Section 49 ITEPA 2003 provides as follows:
(1) This Chapter applies where
(a) an individual (“the worker”) personally performs, or is under an
obligation personally to perform, services for another person (“the client”),
(b) the services are provided not under a contract directly between the
client and the worker but under arrangements involving a third party (“the
intermediary”), and
1
Before February 2015 the company’s name was British Sky Broadcasting Limited .

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