Lorraine’s very good morning!
Star wins battle over £900k tax because she’s a ‘brand’... not an ITV employee
LORRAINE Kelly has escaped a £1.2million tax bill for her work on ITV after a judge ruled that she has too much control over her shows to count as a ‘servant’ of the broadcaster.
HMRC had argued that the presenter owed nearly £900,000 in back taxes and more than £300,000 in National Insurance payments for her work on the Lorraine and Daybreak shows.
It said the firm she used to bill ITV for her work was a front and she should have been taxed as a channel employee rather than as a contractor.
But yesterday a judge accepted that Miss Kelly is in fact her own boss, who has built herself into a brand that broadcasters want to buy, like Oprah Winfrey in the US.
Instead of hiring her as an employee, ITV bought ‘the brand and individual personality of Lorraine Kelly’ as a ‘product’ when it signed a contract
with her in 2012, a tribunal heard. The ruling will be studied closely by other TV personalities being pursued by HMRC for tax because they were paid via their own companies instead of as employees.
Employees hand over up to 45 per cent of their pay cheques, while contractors who charge for their services via independent firms pay as little as 19 per cent.
Last October Eamonn Holmes, host of ITV’s This Morning, revealed he is fighting a legal battle with the taxman over claims £2million he could dating owe back more to 2011. than Former agent Jon Roseman, who represented presenters including Kate Garraway and Jill Dando, hailed the judgment in Miss Kelly’s case as a ‘victory for common sense’. ‘If they can afford to defend it [other presenters] would almost certainly win,’ he said. But he added many would still be wary of taking on HMRC because of the costs involved. Miss Kelly told the tribunal she had been freelance since 1992 and described how, on Lorraine, she decides who appears, what angles to take in interviews and which items to drop or allow to run over. Miss Kelly told the tribunal she was baffled by HMRC’s refusal to accept that she is an entertainer and not a current affairs presenter. She argued she should be classed as an entertainer or ‘theatrical artist’ because she acts every day as a ‘version’ of herself on air. HMRC said it was ‘disappointed’ and will ‘carefully consider’ the ruling before deciding whether to appeal.