A group of referees have won a legal battle against HMRC over a £584,000 penalty charge.

A tribunal found that the officials – some of whom officiated in the Premier League – should have been treated as self-employed. They should therefore pay a lower rate of national insurance.

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HMRC tried to claim back roughly £584,000 in back taxes from Professional Game Match Officials Limited (PGMOL) – the body which represents referees in England – for the period between 2014 and 2016. During this time, the tax authority said that higher rate national insurance contributions should have been paid on the basis that the referees were PGMOL employees.

Not employees

But PGMOL successfully argued against this. It said that, unlike in the Premier League, those who officiate in lower division matches are not directly employed. Many have other day jobs and can turn down requests to take charge of matches due to other commitments.

HMRC challenged the working status of around 60 ‘level 1 national group’ referees who officiate at professional league matches and receive match fees typically worth hundreds of pounds. The UK tax authority argued that they should have been paying higher national insurance contributions – 12% instead of 9%. It also wanted PGMOL to pay employers’ national insurance contributions.

Landmark victory

If HMRC had won, the decision would have also affected around 30,000 amateur referees in lower English football leagues.

“We are disappointed that the tribunal has decided that national list level 1 referees are not employees as we do not think this reflects changing practices within the football industry and the way level 1 referees work in the modern game,” HMRC said. “We are studying the detail of the ruling carefully before deciding on the way forward.”

Andy Chamberlain, the Association of Independent Professionals and the Self-Employed’s deputy director of policy, said this case highlights yet again HMRC’s unclear stance on mutuality of obligation (MOO) and employment status. “It seems to assume [MOO] is present in every engagement. The tribunal disagreed,” he said. “That, combined with a lack of control by PGMOL over the referees, were clear indicators that this was not an employee-employer engagement. Unfortunately, we have again had to rely on the courts to make this determination.”

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