Those interested in the tests for employment status continue to be rewarded by the stream of gig economy cases working their way upwards from the Employment Tribunal (ET), the Employment Appeal Tribunal (EAT) and beyond.
In parallel, the Tax Chamber of the First-tier Tribunal (FTT) has been grappling with the issue of employment status as it arises in a legislative context colloquially known as IR35. These provisions are intended to tackle disguised employment. Briefly, if a worker contracts through a personal service company (PSC) with an end client, IR35 interposes a hypothetical contract between the contractor and the end client, and asks whether that contract would be one of employment. If the answer is “yes” then the PSC is treated as the contractor’s employer and the payments to the PSC by the end client are taxed accordingly. In this way, specialist tax tribunals have come to deal with questions usually dealt with only by the ET. Continue reading