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BBC – public accounts committee

I am somewhat concerned about the comments from the public accounts committee which said it was "shocked" at the large number of people paid by the BBC other than under PAYE.  Apparently around 3,000 operate through limited companies which the committee regards as a way to reduce tax liabilities.  The committee chairman, the Labour MP Margaret Hodge said that such arrangements raised "suspicions of complicity in tax avoidance".

Let’s just ignore the rhetoric – the key issue is are the individuals actually operating as employees or are they genuinely self-employed.  We do not have the necessary details as to the nature of the contracts, the working practices or the other contracts undertaken – but HMRC presumably does, or can get it.  If the individuals are employed they should be paid under PAYE either by the BBC or under IR35 by their own company; if they are not employed there is surely no problem and no tax avoidance.

In fact I do not think tax avoidance is in point here at all – either there is a failure to operate PAYE with the normal consequences (which is not avoidance) or the individual can properly operate as self-employed, which again is not avoidance

Apparently one issue the committee had is that the BBC cannot provide "any assurance" that the workers are paying the appropriate tax.  I suspect that could well be the case with those on the payroll too – employers do not check employees’ tax codes or verify entries in returns so how can they know if any worker – employed or free-lance is paying the correct amount of tax?  Requiring the BBC to check the tax paid by those it pays strikes me as bureaucracy gone mad and – fairly importantly in my opinion – a gross misuse of a proportion of my license fee!
 

 

 

Date: 12th October, 2012
Author: Cathy Corns

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