These past nine years have been a hard slog. But after close to a decade of fighting, this week I defeated the taxman for the third time.
HM Revenue & Customs (HMRC) had been pursuing me for £124,000 in disputed taxes it said I owed relating to my time working as a presenter for the BBC. It would have been closer to £70,000 after off-sets.
It contested my status as a self-employed contractor, claiming I should be taxed as an employee, despite a 30 year career working across many media outlets. Even now , there is still a chance the tax office can appeal again.
Apart from the on-going stress and the punishing legal and accountancy fees in contesting this claim – costs now sit around £200,000, most of it unrecoverable – the most gutting element for me has been the latent suggestion that I am a tax dodger. That is not who I am.
I come from good working-class stock; I take pride in paying my fair dues.
I gave up a safe employment contract more than thirty years ago and since then have worked for countless clients on hundreds of media projects.
I set up my Personal Service Company in 2007, months after the birth of my second daughter on the advice of my accountant. It was standard practice in the industry for freelancers and many companies insisted on it.
Work was thin on the ground at that time and I had no maternity pay to fall back on but I slowly built up a portfolio of engagements including TV, radio, column-writing and corporate hosting.
One of those mixed bag of engagements was a morning radio show for the BBC. When I got a letter from HMRC in 2014 saying they considered me an employee of the BBC, I thought it was laughable. I was paid per show with no employment benefits.
But, five years later, having burned through £125,000 of insurance cover and facing a tribunal, I wasn’t laughing any more.
On the first day of the hearing, HMRC focused its claim on the two years in which my elderly parents fell into ill-health and subsequently passed away. While I did restrict my work for those two years to help care for them, I was sickened that HMRC would seek to take advantage.
When I won, I was elated. Little did I know it was only the start of the nightmare. HMRC appealed – and this is where we get into David and Goliath territory – just as my insurance money had run out. So I had no resources, and they had the bottomless pit of the taxpayers’ purse.
They had the best barristers procured at government rates. I had to pay top dollar – £60,000 to defend myself and the risk of their costs on top if I lost. It was more than the tax at stake and a huge gamble but I was damned if I was going to give in to their mafia-style tactics. I won again.
They upped the ante and took it to the Court of Appeal. We are talking eye-watering figures now, sell-the-house time, and this is where it gets dystopian.
The Court of Appeal clarified some points of law – most in my favour – but declined to rule on my case and then awarded full costs to HMRC. They demanded £51,000 from me and the return of the costs I had won at the Upper Tribunal. I am unlikely to get any of that money back.
Cut to the most recent tribunal win – which cost another £75,000 – and it is three nil to me, yet HMRC still says it is “disappointed” in the decision. Why is it disappointed? Three tribunals tasked with enforcing the rule of law agree that I am a self-employed person. Surely, HMRC should be delighted?
Its job is to collect the “correct” amount of tax, not extort as much as it possibly can get away with. I have been inundated by congratulatory messages from people in the media business I don’t even know.
Most are not high-earners and many are saying regretfully: “I buckled”, “I caved in” , “couldn’t take it anymore”, having settled instead of standing their ground.
To be honest, if I had a crystal ball in 2014, I might have done the same. This ordeal on top of my parents’ illness and death took me to the edge on occasions. Is this really the way His Majesty’s Revenue and Customs should conduct itself’?
As far as I can see, the bigger agenda is to push as many freelancers as possible into a mythical status known as “employed for tax purposes” – to pay full-whack tax with zero employment benefits.
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Kaye Adams is a broadcaster and has worked at the BBC and on ITV’s Loose Women