BBC presenters face tax shock as host is told to repay £419,000

MORE than 100 BBC presenters are facing tax bills that could run into hundreds of thousands of pounds after a former star lost her case against HMRC.

Christa Ackroyd earned more than the Prime Minister as co-host of the regional Look North programme on BBC One.

She was paid as a freelancer through a personal services company at the BBC’S request, but HMRC ruled that she should pay the same level of tax as a BBC employee. Ms Ackroyd must now pay back £419,151.

In its ruling, the tax tribunal in Leeds said that, while this was not a test case, “we understand that the present appeal is one of a number of other appeals involving television presenters and personal service companies”.

At least 100 past and present BBC presenters are under investigation for

alleged tax avoidance by using personal service companies to register as self-employed, thereby minimising tax bills. The case could also have ramifications in other industries.

An HMRC source said: “This is an important marker for employees who were using personal service companies as a device to pay much lower tax. The game is up.”

Ms Ackroyd was poached from ITV in 2001 and presented Look North until 2013 on a £163,233 a year salary.

When the BBC asked Ms Ackroyd to give up a national newspaper column, they paid her £40,000 plus VAT to do so. Ms Ackroyd said she was paid more than many national news presenters because she was “much more than a newsreader”.

HMRC began an inquiry into Ms Ackroyd’s tax affairs in 2011 and the unpaid bill covers the tax years from 20082013. She said after the ruling: “The contract issued by the BBC has now been deemed a contract of employment rather than freelance and is as such subject to different tax rules... As you can imagine, I have suffered five horrendous years of innuendo and gossip suggesting I am a tax cheat.

“This judgment proves once and for all I am not.”

A BBC spokesman said: “The BBC was not party to this case, and as was standard industry practice at the time the individual was engaged as a freelancer in 2001 and paid via their existing company. Until last year it was for individuals with service companies, rather than those engaging them, to determine their status for tax purposes.

“The use of personal service companies is entirely legitimate and common practice across the industry as it provides flexibility.

“An independent review conducted in 2012 found that there was no evidence that the BBC had attempted to avoid income tax or NIC by contracting in this way.”