The BBC is restructuring how it pays some employees.
The broadcaster has applied a new employment test to all staff, including its well-known presenters, that it has previously employed as freelancers.
Where individuals were hired on a freelance basis, they were paid through personal service companies, which can enable high earners to pay 20% to 23% in corporation tax on some of their income instead of the 45% top rate of income tax. There is no suggestion these individuals have behaved inappropriately
However, as freelance contracts come up for renewal, the BBC will assess if individuals should be reclassified as employees on a case-by-case basis.
If this is deemed to be the case, the BBC will move its freelancers onto payroll where they will agree to become employees in line with statutory minimum legal conditions. Although this could mean some will face a pay cut of up to 25%, they will also become eligible to receive benefits which are paid through payroll such as contributions to the BBC’s pension scheme and holiday pay.
A BBC spokesperson said: “The BBC has been applying a new employment test to all on-air television presenters on, or for, new engagements.
“If the result of that test shows employment, presenters have been offered on-air talent employment contracts. There is no truth in claims that television presenters are refusing to move to staff roles.”
One wonders whether this will signal action by the Inland Revenue to mount retrospective investigations into both the BBC and the presenters involved, for failure to observe inland revenue regulations eg IR35. The government introduced that measure to reinforce action to regularise tax “benefits” enjoyed by “self-employed sub contractors” most noticeably freelancers in the IT sector.
HMRC should conduct an immediate investigation into the
payment of TV/Radio presenters by the BBC. It is clear that presenters should have been employees since they are under the control of the BBC and have not been properly self employed. They have to conform to specific hours of work and cannot use an alternate to do their job. It has been clearly
tax evasion on a substantial scale eg NI Class 1 contributions not being paid. Please wake up HMRC!